Trade deficit narrows to $22 billion in December as gold imports ease to $4.7 billion

Amid weak demand in the West, petroleum product shipments declined by 28.62 per cent to $4.91 billion last month. During the first nine months of this fiscal also, these exports contracted by 20.84 per cent year-on-year to $49 billion. “This shows the resiliency of our exports. In all the three quarters of this fiscal also, we have done better. We are doing much better in non-petroleum exports,” Commerce Secretary Sunil Barthwal said, adding that Indian exports of services and goods would cross $800 billion during the ongoing fiscal. On the revision of gold and silver import data for November 2024, the Secretary said a committee has been set up to create a robust mechanism for publishing consistent data.

The government revised gold import data for November 2024, bringing down numbers by $5 billion to $9.84 billion. As per the revised data, exports in November 2024 were down by 5.06 per cent to $32.03 billion, while imports rose by 16 per cent to $63.86 billion. The trade deficit stood at $31.83 billion. Gold imports during the month under review rose by 55.4 per cent to $4.7 billion against $3 billion in December 2023. On the other hand, silver imports jumped by 211 per cent to $421.91 million. In December, India’s shipment rose positively to the US, Saudi Arabia, France, Bangladesh and Sri Lanka. During the month, the top five import sources were China, Switzerland, Thailand, Germany and the US. Federation of Indian Export Organisations (FIEO) president Ashwani Kumar said that the slight decline in goods exports is due to the volatility in commodity and metal prices, along with ongoing international trade disruptions and currency fluctuations.

“Geopolitical tensions in the Gulf region further exacerbated logistical challenges, affecting export flows to key markets like Europe, Africa, and the CIS,” Kumar said.

Kumar stressed the importance of a focused export strategy targeting key markets, particularly the US, as the tariff war presents new opportunities.

On engineering goods exports, Engineering Export Promotion Council of India (EEPC) chairman Pankaj Chadha said that despite challenges and uncertainties on the external front, India’s engineering exports sector has shown remarkable resilience. Continuing the growth momentum for the last eight months, engineering exports grew 8.35 per cent year-on-year to $10.84 billion in December 2024. “There is growing apprehension that once the Trump 2.0 administration assumes charge, some countries with which the US has a sizable trade deficit could face higher tariffs. This is likely to disrupt global trade and also affect India. As the US remains the top market for Indian engineering goods, we remain cautious of the possible fallout of tariff hikes by the Trump government,” he said.