India's merchandise exports in August came in at $21.51 billion, almost the same level as last year's with nearly half the exports sectors reporting growth, raising hope that the worst may be behind. A sharp decline in imports led by a fall in gold puchases throughout India helped keep trade deficit low.
Exports in August were pegged at $21.51 billion compared to $21.58 billion in the year ago period while imports declined 14% to $29.1 billion from $33.9 billion.
Trade deficit shrank to $7.67 billion in August from $12.4 billion in May but almost unchanged from levels in July. Gold imports declined almost 77.4% to $1.1 billion last month.
RBI data showed services exports of $12.7 billion and imports of $7.4 billion in July. Services data is available with a lag.
Non-petroleum imports contracted 15.6% to $22.4 billion while oil imports shrank 8.47% to $6.7 billion. Non-oil, non-gold imports, a measure of domestic demand and strength of economy, fell 1.8% to $21.7 billion.
FIEO reiterated that Rupee depreciation is one of the important factors in pushing exports but not the sole factor. Other issues like high logistics cost, high cost of credit and transaction costs also needs to be addressed besides, little support from global economy.