Indian exports shrank 9.7 percent in August from a year earlier, Director General of Foreign Trade Anup Pujari said, as faltering global growth hurt demand.
Merchandise shipments declined to $22.3 billion last month, Pujari said at a briefing in New Delhi today as he released provisional trade data. Imports slid 5.08 percent to $38 billion, leaving a trade deficit of $15.7 billion, he said.
The debt crisis in Europe and elevated U.S. unemployment have hampered overseas sales by emerging markets from India to China. The South Asian nation has taken steps such as increasing taxes on gold imports to try and narrow the trade shortfall, which has pressured the rupee.
The U.S. market is showing signs of stabilization, Commerce Secretary S.R. Rao said at today’s briefing.
The rupee, which has plunged 14 percent against the dollar in the past year, weakened after the report and closed down 0.3 percent at 55.415 per dollar.
The drop in the currency has stoked import costs, with a report tomorrow set to show that inflation accelerated to 7.1 percent in August, according to the median estimate in a Bloomberg News survey of economists.
Indian gross domestic product rose 5.5 percent in the three months through June from a year earlier, a pace close to the three-year low of 5.3 percent in the first quarter.
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