India’s exports growth slowed down further to 2.35 per cent in August 2014 to $26.95 billion. Some sector has done very god for xample engineering sector grew by 22%,Marine products by 33% , ceramics and glass product by 25% . Petroleum product export however has decreased 13% The export numbers were at $ 26.33 billion in August 2013.
Imports grew at 2.08 per cent during August 2014 to $37.79 billion compared to $ 37.02 billion in August 2013, as oil imports posted a decline which decreased by 15% due to easing of international crude oil price . The gold imports surged dramatically by 170%YoY in August to USD 2bn.
Consequently Trade deficit in August 2014 was at $ 10.83 billion lowest level in this fiscal year , which was higher than last year’s $ 10.68 billion.
Overall, trade deficit to remain almost at the same levels as last year aided by export growth, weak crude oil prices and the continuation of curbs on gold. However, recovery in domestic demand is likely to boost non-oil, non-gold demand (Fig 2) and offset some of the slowdown.
On the whole, current account deficit to narrow towards 1.5% of GDP in FY15 (around USD 30bn), which will far undershoot the robust capital inflows for the year.
Overall balance of payments for this year to register a surplus of approx. USD 35bn, thereby boding well for INR.
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