Why is it in the news?
- India’s foreign trade in August saw a decline in goods exports for the seventh consecutive month.
- The goods trade deficit in August reached a 10-month high, standing at $24.16 billion.
- Goods exports in August decreased by 6.86%, but the rate of decline eased compared to previous months, resulting in a total of $34.5 billion in exports.
- Services exports, which had been growing at a strong rate, are estimated to have shrunk by 0.4% in August, reaching $26.39 billion.
- Trade deficit occurs when a country’s import payments exceed the receipts from its exports.
- It arises in international trade when a nation’s imports surpass the income generated from its exports.
- Trade deficit is often referred to as a negative balance of trade.