Business Desk: India’s trade deficit increased to $39.88 billion in October. In September it was $30.21 billion. Due to sharp increase in imports, trade deficit has increased by about 32%. The special thing is that India’s goods exports reached a record level in October, but the import bill was much higher than that.
According to the report released by the Ministry of Commerce, India exported goods worth $ 49.47 billion to foreign countries in October. At the same time, goods worth 89.35 billion dollars were imported. Exports increased by 45.06% and imports by 16.5% on an annual basis.
Gold import increased three times, expenditure of 5.51 billion dollars
Gold imports increased to $5.51 billion in October, compared to $1.80 billion in September. That means gold imports increased more than three times in a month. The main reason for this has been considered to be the increase in purchases by jewelers and customers before Diwali.
Apart from this, expenditure on import of crude oil and petroleum products also increased. Petroleum imports in October stood at $22.82 billion, which is 54.31% more than the same month last year. Import costs remain under pressure due to ongoing tensions in West Asia and disruptions in the global energy market.
Why did trade deficit increase despite record exports?
India’s goods exports reached a record level of $49.47 billion in October. Good growth was recorded in exports of engineering goods, electronics, gems and jewelery and chemicals.
Exports of gems and jewelery increased by 40.06% to $3.21 billion and exports of engineering goods increased by 36.01% to $12.74 billion.
However, on the other hand, import of goods reached $89.35 billion. Compared to September also imports increased by about 20%. In this way, despite the record increase in exports, the trade deficit increased due to the high amount of imports.
Total trade deficit in April-October 93.35 billion dollars
India’s total exports (goods and services) during the first seven months of the current financial year 2026-27 i.e. April to October stood at $ 568.84 billion. During this period, total imports reached 662.19 billion dollars.
Thus, the total trade deficit including goods and services stood at $93.35 billion, whereas it was $83.25 billion in the same period of the last financial year.
Exports of services in October are estimated at $ 40.51 billion and imports are estimated at $ 20.72 billion. This resulted in a surplus of $19.79 billion in services trade. That is, earnings from services somewhat reduced the impact of trade deficit in goods.
What is trade deficit?
When a country spends more money on buying goods from foreign countries i.e. on imports than it earns by selling goods to other countries i.e. by exporting them, then the difference between the two is called trade deficit.
In the case of India, imports of products like crude oil, gold, electronics and machinery affect this gap. However, accounting for trade in goods and services varies. India gets a surplus from exports of services, which reduces the overall trade deficit.