India’s foreign trade hit a fresh trough in August, with goods exports shrinking for the seventh successive month, services exports estimated to have dropped for the first time in well over a year, and the goods trade deficit hitting a 10-month high.

The extent of decline in outbound shipments eased to 6.86% in August from double-digit contractions in recent months, to hit a three-month high worth $34.5 billion.

Services exports, after growing at a sharp 26.7% rate in 2022-23, were reckoned to have shrunk 0.4% in August to $26.39 billion, stoking fears about a widening current account deficit in this quarter.

The merchandise import bill for August dropped 5.23% year-on-year to $58.64 billion, but was 10.85% higher than July’s $52.9 billion import tally, lifting the goods trade deficit for August to $24.16 billion, just 2.8% below August 2022 numbers and almost 17% over July’s $20.67 billion gap.

Aditi Nayar, chief economist and head of research at ICRA, said that the sharp sequential uptick in imports in August had widened the trade deficit to a 10-month high.