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Stats IQ: India’s Goods Trade

India’s Goods Trade

  • Revision of Estimates: India’s goods trade numbers for February and March have been recently revised by over $10 billion from initial estimate. Key estimates are:
  • Overall Reduced Estimates: The overall export-import figures for 2022-23 have been reduced by around $3 billion dollars each.
    • While exports were earlier reckoned to have grown 6% in 2022-23 to hit $447.46 billion, that number has now been pared to $444.4 billion, reflecting a 5.3% rise from 2021-22.
    • The import bill for 2022-23 has also been scaled down from $714.24 billion to $711.85 billion, indicating a growth of 16.1%.
  • High Trade Deficit: The trade deficit for the year has risen 40.8% to $267.45 bn, slightly higher than the 40% estimated earlier.
  • High Export & Import for February: For February, goods exports have been revised higher by almost $3.1 billion from the initial estimate of $33.9 billion to about $37 billion.
    • The import bill was raised by over $1.93 billion, the second-highest upward revision for a month, after a $3.08 billion uptick from December’s initial estimate.
  • Reduced Export and Import for March: The exports have been scaled down by $3.03 billion from the initial $38.38 billion estimate to $35.35 billion, translating into a sharp 20.7% dip.
    • Imports for the last month of 2022-23 have also been revised downward by around $2.4billion to $55.72 billion.
  • Causes for Revised Estimates: 
    • Petroleum shipments: Revisions in the export numbers are largely dominated by changes in the figures for petroleum exports.
      • Revisions in core export items or segments like gems and jewellery have been insignificant.
    • Russia-Ukraine Conflict:  India’s oil imports from Russia went up after the Ukraine conflict may be part of the trigger for the fluctuating petroleum trade numbers.
  • Interpretation of Revised Estimates: According to Economists, data revisions amounting to over $500 million a month are not normal.
    • It raises uncertainty on the outlook for India’s current account deficit and thereby rupee.
    • With average monthly upward revision in net trade deficit of $1.5 bn, the cumulative for the year could add up to $18 bn. Such sizeable revision in trade deficit data makes analysis quite challenging.

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