In a report today, DBS, a Singapore based financial major released trade deficit data for the country and reported a net 60% jump over the June-October period this year in comparison to the data in the corresponding period last year.

The report highlighted that even if the basket of exports is well diversified it is not turning out for the overall economy. But sooner than later with the subsiding of disruption due to the roll out of GST, the exports are likely to gain momentum.

Import will be influenced by the crude oil prices. And going ahead if the price rises further the import of crude will increase that is set to pressurize trade deficit.

With this the current account deficit of the economy will be hurted. Nonetheless it is to be remembered that a wider CAD does not necessarily casts a negative shadow on balance of payments. More so, the FDI in the country has been quite generous given the favourable policy measures.

Goodreturns.in