Indian Economy: Trade Deficit and Rising Oil Prices

Though there are various external vulnerabilities (prominent among them is a rise of oil price) that need to be arrested in order to continue the growth momentum of the Indian economy, but it seems that the government is taking enough measures to curb the trade deficit. And the results are evident.

Indian Economy Trade Statistics September

Yes, according to the latest reports, the Indian trade deficit has shrunk to a five month low of $13.98 billion for the month of September as compared to August, which was $ 17.39 billion.

The exports recorded for the month of September felt drastically to 2.2% and the imports registered a growth of 10.5%.  The six months report of trade deficit from April to September has recorded to spiral down to $94.32 billion with exports ringing at 12.5% and imports witnessing a paradigm rise of 16.2%.

The Narendra Modi government, which has been constantly criticized for valuing bureaucratic society, increasing inflation and sliding rupee has finally put a block on trade deficit by following below-mentioned measures.

Well, the government has taken various measures to keep the trade deficit and inflation under control

• Hiking of custom duty- Recently, the government has hiked the custom duty on 19 items to curb the steeping rise in CAD and the falling rupee.
• Narendra Modi meeting with the top executives of Saudi Arabia-In order to curb the rise in oil prices, Narendra Modi government has organized the meeting with top 38 think tanks of oil firms along with Saudi oil minister Khalid Al Falih, and Reliance Industries chairman Mukesh Ambani. This meeting is organized to find out the suggestions on how to deal with the current situation and how to attract foreign investment.
• New Licensing Policy- the government has introduced various other reforms including a new exploration licensing policy to help the companies to price the gas without any outside pressure.

All these reforms will definitely strengthen the Indian economy and curb the inflationary trends, but it seems still a lot needs to be done to promote the Indian economy.