Mint Quick Edit | Indian exports showed resilience last month but don’t celebrate yet
Even though US tariffs could yet weigh Indian exports down, overall outward shipments from India so far have been resilient. Government data released on Wednesday shows that exports grew to almost $36.4 billion in September from $35.1 billion in August.
Slight as it is, the rise is notable, given the 50% import levy imposed by the US on Indian goods. September was the first full month after that rate took effect. It’s possible that American importers shared some of that burden with Indian suppliers keen to retain their market presence in the hope that a trade deal will ease levies in a few months.
US policy flip-flops suggest that could happen. An Indian delegation is currently in the US for talks on a trade arrangement that suits both sides. If high US barriers endure, however, stopgap trade financing may thin out. India’s trade gap widened last month to an 11-month high of nearly $32.2 billion, as exports were outpaced by imports—which rose to $68.5 billion from $61.6 billion in August.
As of now, the trade imbalance is not a source of anxiety for policymakers. The real worry is whether our long-range prospects of exporting our way to prosperity will be constrained by today’s turmoil.
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