India posts largest trade deficit since October 2023

India reported a merchandise trade deficit of $23.8 billion in May, which was an increase from the trade gap a year earlier.

The latest figure marked the largest shortfall since October 2023.

India has been running consistent trade deficits for the past four decades due to a surge in imports of mineral fuels, oils, waxes and bituminous substances as well as precious and semi-precious stones and jewelry.

The nation’s total imports rose 7.7% year-on-year to $61.90 billion in May to their highest level in seven months.

At the same time, total exports went up 9.1% year-on-year to $38.13 billion in May, driven by foreign demand for engineered goods, commercial vehicles and smartphones.

The Indian Rupee was little changed on the day against the US Dollar, with the USD/INR currency pair last trading at 83.5110.