India's merchandise trade deficit touched a record high of USD 23.3 bn in Nov-21.
Download ReportNov-21 Merchandise Trade: Deficit posts a record yet again
India’s merchandise trade deficit touched a record high of USD 23.3 bn in Nov-21. In comparison with the previous high in Sep-21 that was driven by a relative outperformance of imports over exports, the record high print in Nov-21 was on account of a relatively faster pace of sequential decline in exports vis-à-vis imports. Receding COVID wave has helped to revive domestic demand while a resurgence in infections (esp. in Europe) is prompting a tightening of lockdown restrictions in some countries. Meanwhile, the rapid spread of Omicron variant of the virus in few countries is a matter of concern as it will have trade implications globally via the channels of price as well as demand. While we hope to get some clarity on the virulence in the coming weeks, some upside to our forecast of India’s FY22 current account deficit of USD 40 bn has emerged.