Understanding India’s imports, exports, and trading partners

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Dec. 3 2014, Updated 4:00 p.m. ET

India’s main exports

India’s main exports include:

  • mineral fuels, oils, waxes, and bituminous substances
  • precious metals and stones, natural or cultured pearls, and imitation jewelry
  • vehicles—not including railway or tramway rolling stock
  • nuclear reactors and boilers
  • organic chemicals
  • pharmaceutical products

Other major exports that aren’t displayed in the above chart include cotton, iron, steel, apparel, and clothing accessories.

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India’s main imports

Mineral fuels, oils, waxes, and bituminous substances and precious metals and stones, natural or cultured pearls, and imitation jewelry are the two main imports. They account for more than 50% of India’s imported goods. Other main imports are plastics, animal or vegetable fats and oils, medical and surgical instruments, and fertilizers.

India’s top trading partners

From April through June, India’s top trading partners were China, the United Arab Emirates (or UAE), and the US. Its top ten trading partners accounted for more than 46% of the total trade during that period. For fiscal year 2013, China overtook UAE as India’s biggest trading partner. It had $65.8 billion in trade. India had the largest trade deficit with China in 2013. Its trade deficit was $36.2 billion.

Among its top ten trading partners in the year, India maintained a trade surplus with four countries—the US, UAE, Hong Kong, and Singapore.

The global economy is improving—except in Europe and Japan. They’re still facing headwinds. However, the recovery is still fragile. Until the economy stabilizes, it will be important to monitor India’s trade balance.

However, this shouldn’t deter you from investing in exchange-traded funds (or ETFs) like the WisdomTree India Earnings Fund (EPI), the iShares MSCI India ETF (INDA), the iShares S&P India Nifty 50 Index Fund (INDY), and the PowerShares India Portfolio (PIN).

If you want broader exposure to ETFs at are focused on India, you can consider the iShares MSCI All Country Asia ex Japan Index Fund (AAXJ) or the SPDR S&P Emerging Asia Pacific ETF (GMF).

In the next part of this series, we’ll discuss India-focused ETFs in more detail.

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