A sharp fall in global commodity prices has helped India cut its import bill by a third in the April-August period this financial year to $102.3 billion from $153.69 billion a year ago.
The decline in the country’s import expenditure not only resulted due to a correction in the crude oil prices, which had peaked in July 2008, but also by an over 40 per cent drop in world commodity prices, says a RBI’s bulletin.
A reduction in imports at a rate faster than decline in exports also helped India almost halve its trade gap to $38.17 billion in the first five months of 2009-10. Experts say importers have also gained from strengthening of the rupee against the dollar, which has of late been hammered against major global currencies.
“Commodity and oil prices crashed globally. The dollar value of imports fell down,” Crisil Principal Economist D K Joshi said. During April-August 2009, the rupee appreciated by about 3.5 per cent against the US dollar. The dollar has also weakened against major currencies, including yen, in the past one month.
In 2008-09, the country’s imports had reached $287.75 billion, widening the trade deficit to $119 billion.
