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2.25% Surge in India’s exports in July

Owing to the higher shipments of organic goods, drugs and pharmaceuticals, there has been a 2.25% rise to US$ 26.3 billion in India’s exports in July’19 from US$ 25.75 billion in June’18. This is positive news given that exports had dropped 9.71% in June in the background of escalating trade tensions between the US and China. Also, India’s trade deficit narrowed to US$ 13.43 billion from US$ 18.63 billion a year earlier.

“The sharp reduction in the merchandise trade deficit in July 2019 relative to July 2018 was largely driven by the moderation in crude oil imports as well as a temporary lull in gold imports after the Union Budget,” opined Aditi Nayar, principal economist at ICRA Ltd. “Moreover, lower commodity prices reduced the size of the import bill in July 2019. While high gold prices may act as a deterrent, demand for gold imports may revive closer to the festive and marriage season,” he added.