India begins its FY22 with a $20 billion merchandise trade deficit
16 May 2022
India exported goods valued at $40.19 billion in April 2022 against exports valued at $30.75 billion in April 2021, showing a growth of 30.70 per cent year-on-year. Merchandise imports into the country during the month, however, increased by 30.97 per cent to $60.30 billion against imports valued at $46.04 billion in April 2021.
Merchandise trade deficit in April 2022 is estimated at $20.11 billion against $15.29 billion in April 2021, which is an increase of 31.50 per cent.
Non-petroleum and non-gems and jewellery exports in April 2022 were valued at $28.46 billion, showing a growth of 19.89 per cent over exports valued at $23.74 billion in April 2021.
Non-petroleum, non-gems and jewellery (gold, silver and precious metals) imports rose 34.37 per cent year-on-year to $35.68 billion in April 2022 against such imports valued at $26.55 billion in April 2021.
April 2022 is the second month in succession when India’s imports crossed $60 billion, exports were above $40 billion and overall trade crossed $100 billion. At this rate, however, the total merchandise trade deficit of the country cold get closer to $250 billion for FY23.
There were several star export performers in April 2022. Exports of petroleum products (127.69 per cent), electronic goods (71.69 per cent), cereals (60.83 per cent), coffee (59.38 per cent), leather products (36.68 per cent), tobacco (35.10 per cent), organic and inorganic chemicals (32.30 per cent), mica, coal, ores (24.81 per cent), jute (22.73 per cent) and engineering goods (21.97 per cent) were among the key growth drivers of exports in April 2022.
However, there were some laggards that registered negative growth in April 2022. Iron ore (-34.16 per cent), cashew (-34.10 per cent), handicrafts (-24.98 per cent), spices (-20.39 per cent), oil meals (-15.66 per cent) and rice (-9.48 per cent).
The big import surge in April 2022 came from silver (820 per cent), fertilisers (219 per cent), sulphur and iron pyrites (216 per cent), coal, coke, briquettes (146 per cent), petroleum and crude (87.54 per cent), pulses (80.01 per cent), raw cotton (57.64 per cent) and leather products (56.08 per cent).
Major items that showed decline in imports y-o-y in April 2022 were gold (-72.35 per cent) and transport equipment (-21.21 pr cent). Gold imports in April 2022 fell sharply from $6.24 billion to $1.72 billion. However, on a sequential basis, gold imports have risen from $1.04 billion in March 2022.
FY 2022 saw India’s overall trade cross $1 trillion for the first time. However, that came at the cost of sharply higher crude imports. FY22 also saw a spike in import of gold, fertilisers and edible oils.