India’s trade deficit widened to $14.6 billion in October 2022, the highest since June 2020. A major reason for this was the 16.7% YoY fall in merchandise exports to $29.8 billion. It was the first such decline in exports in the past 19 months. Demand fell across the US and EU markets, while the festive season in India slowed domestic production. In this edition of chart of the week, we take a look at the merchandise sectors which had the most impact on imports and exports.

The electronic goods sector is the only major sector which saw a rise in exports in October. It grew 37.6% YoY to $1.8 billion. The engineering goods sector fell 21.3% YoY in exports and contributed $7.4 billion (nearly 25%) to  merchandise exports in October. Export of handloom products fell the most by 46.2% YoY to $719 million, while  it was down 11.3% YoY to $4.7 billion for petroleum products. 

Although exports fell, merchandise imports rose by a small margin of 5.7% YoY to $56.7 billion in October. Biggest contributor to this rise in imports was the petroleum, crude & products sector – up 29.1% YoY and contributed $15.9 billion. On the contrary, the gold sector imports fell the most by 27.5% YoY to $3.7 billion, while the electronic goods sector declined 9.2% YoY to $6.2 billion.