Inflation at 23-month low, exports dip 9.7 per cent

New Delhi: The wholesale price-based inflation declined for the second consecutive month in June to a 23-month low of 2.02 per cent on softening of prices of vegetables, fuel and power items, government data released on Monday showed. The decline is steepest since July 2017, when it was at 1.88 per cent.

However, India’s merchandise exports fell 9.7 per cent in June to $25 billion after a gap of nine months, as shipments of gems and jewelleries, engineering goods and petroleum products declined. Merchandise imports also shrank by 9.06 per cent to $40.29 billion, thereby, narrowing the trade deficit to $15.28 billion from $16.6 billion in June 2018.

As per data, the wholesale price index (WPI)-based inflation was at 2.45 per cent in May. It was 5.68 per cent in June 2018. Vegetable inflation softened to 24.76 per cent in June, down from 33.15 per cent in the previous month.

Similarly, inflation in potato was (-) 24.27 per cent against (-) 23.36 per cent in May. However, onion prices continued the rising trend with inflation at 16.63 per cent during the month, as against 15.89 per cent in May.

Meanwhile, with a view to counter the fall of exports, the Commerce Ministry is contemplating a production-based support scheme to boost Make-In-India.

“The new export promotion scheme may replace the existing Merchandise Export from India Scheme, following the US decision to challenge India’s existing export subsidy schemes at the WTO,” a government source said.