Amazingly, India missed the $25 bln per month target for the Fiscal on the lower side with February coming in at $24.67 bln and another $25 bln in {March on renewed Cotton, wheat and rice exports may well take it to just above $292 bln or below the $300 bln we thought would be a low mark for the year. India continued to show an inelasticity of imports in slow growth environment, with Imports for 11 months already at $434 bln or nearly 30% above that for FY11.
The trade deficit for the month based on higher priced Oil imports pending payments to Iran and the lower production in iran and non UN sanctions will continue to impact India’s buyin gin the new Fiscal even as Brent remains below $125 and india’s Oil basket was aready near $112 from H1 last year.
The Import figures till March will be between $465-$475 bln taking the Trade Deficit to $170 bln a good $10 bln above the Eco Survey mark and thus looking to clean out any positive impact of Cash balances on the final CAD
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