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Charts & Analysis

Charts: Merchandise Trade Revives, Service Exports Disappoint


India’s Exports for Feb 2017 show a deficit of about $8.9 billion, but the low base of Feb 2016 allows us a big increase in annualized terms:Exports and Imports
Growth in Trade

Average Trade Per Day is Highest in Two Years!

Feb has only 28 days. So the monthly trade numbers will be lower. What instead if we did the actual number of days and tried to compare this over time? Feb has been very very good indeed:
Average Trade Per Day
Meanwhile, non oil imports have recovered now, and oil imports are much higher in percentage terms (but relatively flat again due to a low base).
Oil and NonOil Imports

Services: Blah.

We run a deficit on the merchandise trade but a surplus on services. However net service surplus is still around $5 billion, and has been much lower than earlier. We don’t have Feb data yet, this is till January 2017.
Services Not That Great

Our View : Bullish, Finally

While the base was low last year, this seems to be a change from previous years in terms of total trade per day. However, we have to note that:

  • Gold imports are up over 140% from last year. (link)
  • Silver imports are up 260%
  • Oil product imports are higher due to the rise in price, mostly.
  • There’s a 30% decline in machinery
  • And just 10% rise in electronic goods imports

These are just some negatives – because gold is usually used for non-productive reasons, so the imports don’t work in our favour. Still, this is the best data we have seen in a while, and let’s hope it continues. (The base effect means we will get better trade data in the near future)
The USD INR is now at 65.4 which is fairly low. And that means the export competitiveness may fade – let’s see how that works out.


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