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31.12.200810:10:00UTC+00India's trade deficit widens in the second quarter

India's trade deficit widened to $ 38.6 billion in the second quarter of fiscal 2008-09, the Reserve Bank of India, RBI, said Wednesday. In comparison, the trade deficit in the second quarter of the previous year was $21.2 billion. The Current Account deficit jumped to $12.5 billion in the second quarter, from the $4.3 billion deficit posted in the same period of the prior year.

Merchandise exports climbed 24.6% in the second quarter to $47.67 billion, while merchandise exports grew 17% to $38.27 billion in the same year ago period. Imports soared 45% to $86.29 billion, compared to the 22.2% growth in imports to $59.51 billion in the second quarter of the prior fiscal year. Oil imports accounted for 33.2% of total imports in the second quarter, compared to 32% in the same year ago period.

Invisibles receipts surged 33.9% in the second quarter, pushed by private transfers, steady growth in software services and business and professional services exports, while invisibles receipts grew 36.8% in the same period a year ago. Net invisibles came in at $26.1 billion in the second quarter, while net invisibles were $16.9 billion in the same quarter of the earlier year. Net invisibles financed 67.5% of the trade deficit in the second quarter of 2008, compared to 79.8% in the same prior period, the RBI said.

In the second quarter, gross capital inflows were $85.7 billion, compared to the gross capital inflows of $95 billion in the previous year. Gross capital outflows were $77.5 billion, higher than the gross capital outflows of $61.9 billion witnessed in the same prior period.

In the first half of fiscal 2008-09, the trade deficit increased to $96.73 billions compared to the trade deficit of $72.62 billions in the first half of the previous year.

India's total external debt stood at $222.61 billion at the end of September 2008, slightly less than the total debt of $223.81 billion at the end of June. Long-term debts at $172.51 billion constituted 77.5% of the external debt. Short-term debts, including trade related credits, FII investments in government securities and external liabilities of the banking systems amounted to $ 50.1 billion. Private debts accounted for 74.6% of total external debts.

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