Focus: GS-III Indian Economy
Why in news?
India may register its first monthly trade surplus in over 18 years as the pace of contraction of exports is estimated to have slowed down to around 12%, while imports are seen to have fallen almost 49% during the month.
- The last time India had a positive balance on the trade account was in January 2002 when it had a surplus of $10 million with exports of $4.3 billion.
- But imports remain an area of concern, as it is a barometer of overall economic activity.
- The initial numbers suggest that the sharp decline in imports was led by gold, silver and precious & semiprecious stones, which are also linked to exports.
- During crises, demand for jewellery drops significantly as people look to conserve cash.
- Imports related to the textiles sector — including cotton, fabric and made-ups — are also down sharply along with transport equipment, chemicals, iron & steel, machine tools and electronics, indicating a slump in economic activity.
-Source: Times of India