Mecklai Graph: Will contraction in trade deficit continue?
Mecklai graph of the day: In the calendar year 2012, it has been observed that their monthly trade deficit figures has outpaced the respective corresponding year‘s figures.
June 18, 2012 / 12:46 IST
Mecklai graph of the day: Will contraction in trade deficit continue?
In the calendar year 2012, it has been observed that their monthly trade deficit figures has outpaced the respective corresponding year’s figures. However, the provisional trade deficit figures for May were comparatively lower than the May 2011 figures proving to be an exception to the trend of rising trade deficit. Such a change in trend provides some respite and hope to our ballooning trade deficit numbers. The fall in trade deficit was an outcome of fall in imports of non-oil products and a sizeable fall in crude prices, which happens to be a major component of our import bill.The rupee depreciation in 2012 should have eased the trade deficit, but that didn’t happen as fall in the global growth negated the positive impact of Rupee depreciation as the exports rose by 4.8% M-o-M, whereas the growth in imports almost doubled to 10.6% M-o-M. However, on comparison with 2011, trade deficit for the month of May 2012 seems to be reducing which can be a sign of positive hope for India in the midst of all the pessimistic news for India.The below graph shows the trade balance of India for 2011 and 2012 respectively.
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