Bhubaneswar: Sanjay Malhotra, Governor of the Reserve Bank of India, has said that India’s merchandise exports witnessed a marginal contraction of 0.2% in the first two months of the year on a year-on-year basis, primarily due to weaker demand in key global markets.
In contrast, merchandise imports registered a sharp increase of over 22%, largely driven by higher gold imports, leading to a widening of the country’s trade deficit.
Current Account Outlook
Despite the widening trade gap, the RBI Governor expressed confidence that India’s current account deficit (CAD) will remain within sustainable levels. This is supported by robust performance in services exports and strong inward remittance flows during the last quarter of the previous financial year.
Global Risks Remain
Malhotra cautioned that rising global uncertainties and elevated prices of key energy commodities could pose upside risks to India’s current account deficit in the current year.
Positive Trade Outlook
He also highlighted that recent bilateral and regional trade agreements with major global partners are expected to enhance India’s trade and investment prospects going forward.
-OdishaAge
