Explain the trend in India's imports.
Import trade refers to the purchase of goods and services by one country from another. In other words, it is the inflow of goods and services to the home country from a foreign country.
The trend in India's imports can be explained as follows:
- Petroleum: Petroleum has always been the most significant import item in India’s trade in the pre as well as post-reform period. In 1990-92, it had a share of 27% of total imports which currently stands at around 31%.
- Gold: The second most imported item is gold. However, the gold imports declined from 53.3 billion US $ in 2011-12 to 27.5 billion US $ in 2013-14. This was primarily due to falling in international gold prices and policy measures by the government to curb gold imports.
- Fertilizers: The share of fertilizers in import expenditure declined from 4.1% in 1990-91 to only 1.3% in 2016-17.
- Iron and Steel: The share of iron and steel in import expenditure declined from 4.9% to 2.1% in 2016-17.