India's January exports up 3%, trade deficit narrows despite Red Sea crisis

India's merchandise trade deficit narrowed to $17.49 billion in January as exports edged up by 3.1 percent year-on-year despite the ongoing crisis in the Red Sea disrupting trade as commercial vessels traversing through the Suez Canal face attacks from Yemen-backed Houthi rebels.

The merchandise trade deficit stood at $19.80 billion in December 2023.

According to data released by the commerce ministry on February 15, India's exports in the first month of 2024 amounted to $36.92 billion, up from $35.80 billion in January 2023 but down from $38.45 billion in December 2023.

"Despite the Red sea crisis, continued recession in advanced nations, and falling commodity prices we have been able to achieve positive merchandise export growth rate," Commerce Secretary Sunil Kumar Barthwal said in a briefing.

Meanwhile, India's merchandise imports were also up 3.0 percent year-on-year last month at $54.41 billion, although they were down from $58.25 billion in December 2023.

For April 2023-January 2024 as a whole, India's goods exports stood at $353.92 billion, down 4.9 percent from the first 10 months of 2022-23. Imports were down an even greater 6.7 percent year-on-year at $561.12 billion. As a result, the trade deficit was nearly 10 percent lower at $207.2 billion in April 2023-January 2024.

Barthwal told reporters on February 15 that while the global situation, given the conflicts, is not looking very optimistic, the government will continue to work with exporters to ensure outbound shipments keep growing.