India's January Trade Deficit Reaches $34.68 Billion

India's merchandise trade deficit climbed to $34.68 billion in January, marking the highest level in the past three months.

Reuters reported on Feb. 16 that the increase came even as a roughly 50% U.S. tariff on Indian exports remained in effect, with plans to reduce it to 18% this week.

The Indian Ministry of Commerce stated that imports of gold and silver rose significantly in January, boosting total imports by 12% from the previous month to $71.24 billion. Exports, meanwhile, fell 5% to $36.56 billion.

Exports to the United States, India's largest export market, dropped 4.5% in January to $6.58 billion. Over the first 10 months of the current fiscal year, India's exports to the U.S. totaled $72.46 billion.

Indian officials warned that the surge in gold imports, along with investments in gold exchange-traded funds that nearly doubled to $2.65 billion in January, could pressure the country's current account deficit.