New Delhi: India’s gold imports dipped 57.7 per cent year on year to $2.3 billion in August even as overall merchandise imports rose 14.1 per cent to $70.67 billion, government data showed on Tuesday.
Merchandise gold exports surged 26.1 per cent to $43.81 billion in August, narrowing India’s trade deficit.
India’s trade deficit dropped to $26.9 billion in August, down from $31.98 billion in July as merchandise exports rose 26.1 per cent on an annual basis. The fall in deficit could provide some relief to the rupee, which has been relatively showing a weaker performance this year.
Strong demand from the United States, the European Union and emerging markets supported the export surge, Commerce Secretary Rajesh Agrawal said.
The export surge was broad-based, with engineering goods, petroleum products, chemicals and textiles among the sectors supporting growth.
The sharp fall in gold imports followed elevated global prices and repeated appeals by Prime Minister Narendra Modi to curb gold purchases to help contain the import bill.
Inbound gold shipments stood at $2.3 billion in August, down from $4.16 billion in July and on an YoY basis imports were down 57.7 per cent.
Uptick in merchandise imports were supported by domestic economic activity and demand for inputs used in manufacturing, along with higher energy prices adding to the import bill.
Prime Minister Narendra Modi described India’s trade performance a “herculean feat” despite oil shocks, supply-chain disruptions and global uncertainty.
Prime Minister Narendra Modi appealed to curb foreign travel, gold purchases and weddings to conserve foreign exchange necessary due to import dependence during India’s rapid growth phase.
As the economy grows faster, the need for both energy and technology inputs grow. Hence, the country needs foreign exchange to pay for precision machines, materials, CPUs, GPUs and advanced software.
(IANS)
