Gold, silver imports push trade deficit to 3-month high

NEW DELHI: Trade deficit widened to a three-month high of $34.6 billion in Jan as gold and silver shipments pushed up the import bill, while exports remained flat on a sharp fall in goods consignments to the US.

India's imports rose 19.1%, the highest since last April, to $71.2 billion - the second highest for any month. Gold imports surged 4.5 times to $12 billion, while silver jumped 2.3 times to $2 billion.

During Jan, exports were up 0.8% to $36.6 billion amid a fall in gems and jewellery and textiles, while electronics and pharma saw a muted increase.

Govt is, however, confident of closing the year with record exports. "India's exports remain northward, both for goods and services. We hope that in the last two months too it will be on the same trajectory. We are well poised to be nearing $860 billion this year, and services are expected to cross $410 billion for the first time," said commerce secretary Rajesh Agrawal.

A part of the confidence stems from a revival in US demand in sectors such as gems and jewellery and textiles after the punitive 25% secondary tariffs were withdrawn at the start of Feb.

During Jan, India's exports to the US, slumped 22% to $6.6 billion. In contrast, imports jumped 23.7% to $4.5 billion, helping narrow the trade deficit to $2.1 billion, less than half last year's level of $4.8 billion.

"FY26 has been a busy period for trade, with several positive developments helping India sustain overall trade growth. With some of the key FTAs coming into force next financial year, we foresee the positive momentum to continue in FY27," said Agrawal.