Subdued import of gold and silver pulled down the trade deficit in June to $12.2 billion despite 4.56 percent contraction in exports during the month. Gold and silver imports dipped to $2.45 billion in June from $8.4 billion in the previous month. However, compared to June 2012, the imports grew by 22.8 percent.
Trade deficit had widened to a seven-month high of $20.1 billion in May. "The decline in gold and silver imports can be attributable to the steps taken by government specially by the RBI in May and June by which gold imports for domestic use was discouraged. I think that might have translated into lower imports of gold," Director General of Foreign Trade Anup Pujari told reporters. Imports too declined marginally by 0.37 per cent to $36 billion during the month. Exports stood at $23.79 billion against $24.9 billion in June 2012. Pujari said that global demand has still not recovered and there was fall in Chinese and Japanese exports too.
The chairman of trade promotion body EEPC India, Aman Chadha, said that the two largest markets EU and the US are not supporting. "We have to urgently devise a strategy to reach out to newer markets in Africa and Latin America." Oil imports in the month grew by 13.74 per cent to $12.76 billion, compared to $11.22 billion in June 2012. Non-oil imports declined by 6.7 per cent to $23.2 billion. Petroleum exports too grew by 4.42 per cent to $4.34 billion from $4.15 billion in June 2012.
For the April-June period this fiscal, exports were down by 1.41 percent at $72.45 billion over the same period last year. However, imports during the period were up by 5.99 percent at $122.6 billion. The sectors which witnessed substantial decline of over 20 per cent in overseas shipments include iron ore (33 per cent), gems and jewellery (26 per cent) and spices. Iron ore and gems & jewellery exports declined to $87 million and $3.4 billion in June from $130 million and $4.6 billion in the same period last year respectively. However, marine products exports jumped 36 per cent, rice by 28 per cent and chemicals by 21 per cent.
Besides, gold and silver, precious stones, wood and wood products, news printing, cotton (raw and waste) and fertilizer recorded over 20 per cent jump in imports in June. Federation of Indian Export Organisations President Rafeeque Ahmed said: "There is a need to make manufacturing competitive to support exports. There is strong linkage in manufacturing growth and exports." China posted a negative growth of 3 per cent in exports in June, he added.
