A likely trade deficit of around $200 billion during the current year ($110 billion during April-October 2012) — exceeding last year’s all-time record of $185 billion — is ringing alarm bells. When viewed against the backdrop of deceleration in industrial output — in particular, the capital goods sector — this shows that excessive imports are being resorted to for supporting consumption, instead of growth. Crude petroleum, fertilisers, edible oils, pulses, account for a major share of our import bill. Their imports remain high, irrespective of the prevailing international prices. Thus, even when prices shoot up, imports do not go down. We import 80 per cent of our crude requirement. In phosphate, this is 80-85 per cent; potash 100 per cent...
More No comments