Widening trade deficit is worrying aspect, says Commerce Secretary S.R. Rao
New Delhi, Feb. 13 : Expressing concern over the huge surge in the import of petroleum and crude oil, Commerce Secretary S.R. Rao on Wednesday said that the widening trade deficit is a worrying aspect for the Indian economy.
"The worrying aspect as usual is the widening trade deficit and our figures show that substantial increase in the import of petroleum and crude oil is widening this trade deficit," Rao, while talking to reporters here. The Ministry of Commerce has posted its second highest monthly trade deficit of 20 billion dollars in January, worsening from a 17.7 billion dollars deficit in December. Struggling to turn around an economy that is slowing to its lowest growth rate in a decade, the Reserve Bank of India (RBI) cut interest rates by 0.25 percentage points last month, but warned that future rate cuts would depend upon declines in both the current account deficit and inflation. But there was little sign of any respite on the external front of the economy in December as a surge in imports dwarfed a slight improvement in exports. According to a senior official of the ministry, exports increased with an annual 0.8 percent to 25.59 billion in January, while imports 6 with percent to 45.58 billion dollars. The December trade deficit was the worst on record after the 20.9 billion dollars gap posted in October. Current account data for the October-December quarter will be released at the end of next month, but the deficit touched a record high in September at 5.4 percent of GDP due to slowing exports and heavy oil and gold imports.--ANI