India's merchandise trade data, the monthly trade deficit moderated to USD 19.9 bn in Oct-21 from its all-time high of USD 22.6 bn in Sep-21.
Download ReportOct-1 Merchandise Trade: Deficit eases, but new pressure points emerge
Along expected lines, India’s merchandise trade deficit moderated in Oct-21, coming in at USD 19.9 bn from its all-time high of USD 22.6 bn in Sep-21. On monthly basis, exports touched a new all-time high, thereby increasing the likelihood that government’s FY22 target of USD 400 bn would be exceeded comfortably. While headline imports moderated, new pressure points in the form of coal and silver have emerged, even as oil imports remain elevated. Trade deficit in H2 FY22 is likely to widen amidst easing of lockdown restrictions, pickup in inoculation, and elevated international commodity prices. We revise up our FY22 current account deficit forecast to USD 40 bn from USD 30 bn earlier. Hence, our estimate of FY22 BoP surplus moderates to USD 48 bn from USD 61 bn earlier.