Green shoots of goods export recovery and larger services trade surplus are set to narrow the CAD sharply
India’s merchandise exports contracted a modest 2.6% YoY in Sep’23, and Aug’23’s initially-reported 6.9% YoY decline in exports was revised up to growth of +3.9% YoY. Consequently, India’s goods exports declined a modest 2.9% YoY in Jul-Sep’23 (while China’s exports declined 9.6% YoY and South Korea’s 9.3% YoY during the quarter). Goods imports declined 15% YoY in Sep’23, and 11.6% YoY in Q2FY24, and the quarterly goods trade deficit declined 23.9% YoY.