Which fiscal condition related to India's trade balance did the Economic Survey 2024 report for FY24?

The correct answer is Narrowed trade deficit.

Key Points

• The Economic Survey 2024 reported that India's trade deficit narrowed in FY24 compared to previous fiscal years, reflecting an improvement in the country's external trade balance.
• This narrowing was attributed to factors such as increased exports of services and a reduction in the import bill for energy commodities like crude oil.
• India's merchandise exports saw a moderate growth, while imports declined slightly due to lower global commodity prices.
• The survey highlighted the resilience of India's economy amidst global challenges, with a focus on boosting exports and reducing dependency on imports.
• Strong performance in the IT and services sectors played a critical role in offsetting the merchandise trade deficit.

Additional Information

• Trade Deficit: A trade deficit occurs when a country's imports exceed its exports, leading to a negative balance of trade.
• Service Exports: India's IT and financial services sectors contribute significantly to overall exports, helping reduce the trade deficit.
• Global Commodity Prices: Fluctuations in prices of commodities like crude oil, natural gas, and metals directly impact India's import bill.
• Current Account Deficit (CAD): The trade deficit is a major component of the current account. A narrowed trade deficit helps in reducing the CAD, which is crucial for economic stability.
• Government Initiatives: Programs like the Production-Linked Incentive (PLI) scheme aim to boost manufacturing and reduce import dependency, thereby improving the trade balance.