Imports in October, however, grew by 7.6 per cent to $37.11 billion, from $34.5 billion in the same month a year ago, a Commerce Ministry release said.
The decline was led by sharp falls in major labour-intensive sectors such as leather & leather products, gems & jewellery, handicrafts, readymade garments, and carpets. The data shows 7.6 per cent growth in the trade deficit, which amounts to $37.11 billion in October from $34.5 billion in the year-ago period. Though IIP is measured in constant prices and trade figures are in current prices, non-oil/non-gold imports give a broad indicator of industrial demand.
India's trade deficit widened to its highest in almost three years in October, government data showed on Tuesday, as export growth contracted for the first time after more than a year.
"The decline in exports was expected because exporters were struggling with a liquidity crunch after paying the Goods and Services Tax for four months in a row without getting any refund", Federation of Indian Export Organisations President Ganesh Kumar Gupta told Mint. Mr Gupta said that there is immediate need for remedial measures to prevent further decline in exports otherwise the situation may be worse for November, 2017.
It added that implementation of the measures approved by the GSTCouncil is not taking place as a result challenges faced by exporters remain the same. The data shows oil and non-oil imports grew by 27.89 per cent and 2.19 per cent to $9.28 billion and $27.83 billion, respectively in October. Trade deficit increased to $3.04 billion in October 2017, higher by 35.88 percent over $2.2 billion for the same a year before.
While petroleum exports in October grew by 14.74 per cent, engineering was up 11.77 per cent and chemicals exports rose 22.29 per cent. Aditi Nayar, principal economist with rating agency Icra, says: "Gold imports contracted in October despite onset of the festive and wedding season, given the build-up of substantial stocks over the past few months".
The rising oil imports come at a time when the global crude oil prices are surging each day, pushing even fuel prices at home higher.
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