Facts for Prelims (FFP)
Source: Th
Context: According to recent official data, India recorded a trade deficit with nine of its top 10 trading partners, including China, Russia, Singapore, and Korea, in 2023-24.
What is Trade Deficit?
A trade deficit occurs when a country’s imports exceed its exports, meaning it buys more goods and services from other countries than it sells to them. This results in a negative balance of trade, indicating that more money is flowing out of the country to pay for imports than is coming in from exports.
India’s total trade deficit narrowed to about $238 billion in 2023-24, down from $265 billion the previous year. The trade deficit widened with China, Russia, Korea, and Hong Kong but narrowed with the UAE, Saudi Arabia, Russia, Indonesia, and Iraq.
China became India’s largest trading partner with over $118 billion in bilateral trade, surpassing the U.S., which had over $118 billion in trade. India maintains free trade agreements with Singapore, the UAE, Korea, and Indonesia. Significant trade surpluses were recorded with the U.S. (of over $36 billion), the U.K., Belgium, Italy, France, and Bangladesh.
