Non-oil, non-gold imports, often cited as a yardstick for the strength of domestic demand, fell 3.5% from a year ago in May, underlining the weakness in the economy.

The chart shows that non-oil, non-gold imports are lower than what they were a year ago, as well as lower than in January this year.

A 16 June report by Nirmal Bang Institutional Equities said: “Imports of capital goods fell for the first time in four months, while commodity imports were flat (after growing by an average ~20% in the past one year). This broad-based fall in imports, if it continues in the coming months, poses a threat to the nascent recovery in domestic investment cycle."

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