India’s Trade Deficit Hits Record High as Gold Imports Surge 200%
India's goods trade deficit ballooned to a historic $41.7 billion in October, far exceeding the $28.8 billion forecast and surpassing the previous record of $37.8 billion set in November 2022. The surge was driven by a 200% year-on-year increase in Gold imports, which reached $14.7 billion as Indians splurged during the festival season.
Exports to the U.S. fell for the second consecutive month, dropping 8.5% to $6.3 billion following the imposition of 50% tariffs in late August. Despite the decline, the U.S. remained India's top export destination, with $52 billion in shipments during the first seven months of the fiscal year.
Sector-wide declines exacerbated the trade imbalance. Gems and jewelry exports plummeted 29.5% to $2.3 billion, while engineering goods fell 16.7% to $9.4 billion. Textiles and related products also saw double-digit declines, with cotton and yarn exports down 12-13%.
