India’s merchandise exports rose sharply in May, reaching their highest level in six months and offering a positive signal for the country’s external trade sector. However, a surge in imports led to a wider trade deficit during the month.
Official data showed exports grew 18% year-on-year to around $43.4 billion in May, driven by robust demand for engineering goods, electronics, chemicals and pharmaceutical products. The strong performance comes amid signs of improving global demand and increased competitiveness among Indian exporters.
The growth in exports was welcomed by industry bodies, which said Indian companies have continued to find opportunities in key international markets despite global economic uncertainties and geopolitical tensions.
Imports, however, grew at a faster pace, rising to nearly $70 billion during the month. Higher purchases of crude oil, gold, electronic goods and industrial inputs contributed significantly to the increase. As a result, India’s merchandise trade deficit widened to about $26.4 billion.
Economists said the rise in imports reflects both stronger domestic demand and higher commodity purchases. While a widening trade deficit can put pressure on the current account balance, it may also indicate growing economic activity and industrial production.
For exporters, the latest numbers provide encouragement after months of uneven global demand. Many sectors have benefited from government support measures, trade diversification efforts and improving supply chain conditions.
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