Why is it in the news?
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India’s trade deficit expanded to a six-month high of $15.4 billion in May.
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Import growth outpacing export growth following a 37% jump in gold imports.
More in the news
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Exports grew 3.93% in May to $30 billion compared with $28.86 billion worth of exports in the same month last year.
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Possible Causes:(1) China’s exports in May inched up 1.1%, while imports fell 8.5%, leading to a significantly higher trade surplus of $41.65 billion than analysts projected.(2) The escalating trade war between the US and China, and rising protectionism have cast a shadow on India’s prospects for higher exports.
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In March, the World Trade Organization (WTO) had projected trade growth to fall from 3.9% in 2018 to 3.7% in 2019.
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It had cautioned that these estimates could be revised downward if trade conditions continue to deteriorate.
Source
LiveMint.