India’s December trade deficit has come in lower than estimates at $21.94 billion compared to the revised November trade deficit of $32.84 billion. This is primarily on the basis of higher exports and month-on-month drop in overseas shipments. According to a market poll, December trade deficit was expected to be at $27.33 billion
Earlier last month, the government had reported that the November trade deficit was revised from $37.84 billion to $32.84 billion after the gold imports revision. The government had slashed gold import estimates for November by $5 billion, reducing it from $14.86 billion to $9.84 billion.
Per the data, December merchandise exports were at $38.01 billion and imports came in at $59.95 billion. During November, merchandise exports were at $32.11 billion and imports were at $64.95 billion.
The trade deficit data will remain in focus in the next few months as Donald Trump is all set to take office as US president on January 20. He had earlier announced his plans to create a new agency called the External Revenue Service to collect tariffs and other revenues from foreign nations. “We will begin charging those that make money off of us with Trade, and they will start paying,” Donald Trump had said on his social media site, Truth Social.
Trump had called India a “tariff king” and a “very big abuser” in terms of import tariffs and had also vowed to introduce a reciprocal tax against India if elected to office. The US is India’s largest export market, and any imposition of tariffs could challenge India’s trade balance and impact these sectors.