Exports drop by 12.2% in 2022
#GS-03 External Sector
- Trade deficit or negative balance of trade (BOT) is calculated as the difference between exports and imports when imports are higher than exports.
- The opposite of trade deficit is termed trade surplus and it occurs when exports are higher than imports.
- Trade deficit forms a part of the Current Account Deficit.
Current Account Deficit:
- The current account deficit is the measure of a country’s trade when the value of the goods and services it imports is more than the value of the products it exports.
- Current account is calculating using the formula (X-M) + NI + NT
- Where X-M stands for trade balance, X, the value of Exports and M, the value of Imports.
- NI is the net income from abroad which mainly includes income from foreign countries such as interests and dividends.
- NT is the net current transfers which consist of government transfers such as foreign aid.
- The current account is representative of a country’s foreign transactions and along with the capital account, forms a country’s balance of payments (BOP).
Balance Of Payments (BOP)
- The balance of payments (BOP) can also be called as the balance of international payments.
- It is a statement which includes all transactions made between entities in one country and the rest of the world over a fixed period of time, such as a quarter or a year.
- India exported goods worth $34.48 billion in December 2022 which showcases a 75% rise from November 2022.
- However, it’s a steep 12.2% dip from the same figure last year.
- This is the second time in three months that the value of exports has decreased in a year-on-year basis, the other being October 2022.
- Despite a dip in two months, merchandise exports in the first nine months of 2022-23 showed a rise of 9.1% than a year ago at $332.76 billion.
- Goods imports, on the other hand, had increased by about 25% at $551.7 billion.
Exports from 19 of 30 major exporting sectors shrank in December, including;
- Cotton yarn and handlooms (-40.4%),
- handicrafts (-36.9%),
- petroleum products (-26.9%),
- plastic and linoleum (-26.23%),
- gems and jewellery (-15.2%).
For more updates, click here