Merchandise exports in May increased by 69.35% from a year ago to $32.27 billion, driven by growth in the engineering, petroleum, and gems and jewellery sectors.
Trade deficit in goods stood at $6.28 billion, the lowest in eight months. Trade deficit was $15.10 billion in April and $3.15 billion in May, 2020. Imports in May were up 73.64% year-on-year to $38.55 billion.
Exports to the US, UAE and Singapore recorded the highest jumps. Exports of engineering, petroleum products and gems and jewellery in May were worth $8.64 billion, $5.33 billion and $2.96 billion, respectively.
Engineering Export Promotion Council said that while the export outlook has been projected to be positive in the current fiscal, there were downside risks too, given that public health experts have predicted a possible third wave of Covid-19 and sought targeted policy intervention.
Gold imports in May increased by 790% from a year ago to $679 million, data showed. Oil imports grew 171% to $9.45 billion compared with $3.49 billion in May 2020.
Non-oil and non-gold imports in May increased by 52.48% year-on-year. Taken together with services, India registered an overall trade surplus of $1.6 billion in May. Exports during April-May this year jumped to $62.89 billion, as against $29.41 billion in the same period last year.
Nayar said the steady exports over April-May 2021, despite the second surge in Covid-19 infections and associated lockdowns, are heartening, suggesting that India may be well poised to benefit from recovering demand in the advanced economies.
Desai said growth in outbound shipments has been robust over the last few months and the outlook remains positive for the current year, but rising cost of key raw materials, especially steel, is a concern.