NEW DELHI: India’s trade deficit hit a seven-month high in May as gold imports surged, raising fresh concerns about Asia’s third largest economy, data showed yesterday. The deficit stretched to $20.1bn from $17.8bn a month earlier, mainly because of an almost 90 percent jump in gold and silver imports from a year earlier, the data showed.
“As far as trade deficit is concerned, it is very worrisome... It is largely contributed by heavy imports of gold and silver,” Commerce Secretary S R Rao said. Imports rose 7 percent in May from a year earlier to $44.65bn, while merchandise exports fell 1.1 percent year-on-year to $24.51bn in May. The gap was $16.9bn in May last year, data from the ministry of commerce and industry shows.
The figures serve as another warning light for the Indian economy, which grew at its slowest pace in a decade last year due to high inflation and borrowing costs as well as low business confidence. The government has announced measures, including hiking import duty, to try to curb buying of the metal, one of the main contributors to the widening deficit in the current account, the broadest measure of trade. AFP
