India's trade deficit, or the gap between merchandise imports and exports, fell from USD 7.64 billion in January to USD 6.54 billion in February.
The narrowing in the deficit was led by a 5.66 percent fall in exports, which came in at USD 20.74 billion in February, compared to USD 21.08 billion in January. Imports fell 5.03 percent from USD 28.71 billion to USD 27.28 billion.
Within imports, oil imports stood at USD 4.77 billion (down from USD 5.03 billion MoM) while non-oil imports stood at USD 22.51 billion (versus USD 23.69 billion).
Gold imports fell sharply (29.5 percent) to USD 1.4 billion.
While the fall in imports provides comfort on the current account, a bigger fall in exports presents a worrying picture of the state of the global economy and the local manufacturing sector.
A USD 6.5 billion deficit will likely be squared off by "invisible" (software, etc) exports of a similar amount, which would likely mean the country has moved closer to a current account balance, or possibly surplus situation.