India’s merchandise exports in December surged a record 38.91% on-year to $37.81 billion, buoyed by growth in outbound shipments of engineering, textiles and chemicals, official data released Friday showed. Imports too rose a record 38.55% to $59.48 billion, widening the trade deficit to $21.68 billion.

“As compared to December 2019, exports in December 2021 exhibited a positive growth of 39.47%,” the commerce and industry ministry said in a statement.

The trade deficit was $15.72 in December 2020.

Gold imports rose 5.43% in December to $4.72 billion last month while non-oil, non-gold imports reported a year-on-year increase of more than $1 billion. Oil imports were up 67.89% on-year.

As per the data, 23 of the 30 major export sectors witnessed a rise in shipments.

“While the order pipeline has been remarkably good, we could see some slowdown in case Omicron disrupts the global supply chain. In recent weeks we have seen some signs of volatility and uncertainty due to the ongoing pandemic wave across the world, but by putting suitable policy measures in place, the government could provide a cushion to the trade and business,” Engineering Export Promotion Council chairman Mahesh Desai said.

Desai called for urgent action on part of the government to calm down soaring raw material prices and reduce logistics cost in the upcoming budget.

“Looking at the current trend, we are on course to achieving the $400 billion merchandise exports target for the fiscal,” said Federation of Indian Export Organisations president A Sakthivel.

Sakthivel saw imports clocking $59.48 billion during the month with a very high growth of 38.55% as a point of concern that needed to be analysed.

Others played down the concern.

“Though the trade deficit is growing exponentially, it’s primarily due to petroleum and gems and jewellery imports. India has headroom to accommodate further import growth that goes into manufacturing and export of value-added products,” said Prahalathan Iyer, Chief General Manager, Research & Analysis, India Exim Bank.