What is a Trade deficit?

A Trade Deficit occurs when the value of a country’s imports exceed its exports for a specific period of time, usually a year.

The relationship between imports and exports are called the trade balance. When exports exceed imports it is called a trade surplus. Trade deficits can occur in both developing and advanced countries.Basically, it represents an outflow of domestic currency to the foreign markets.

India's trade deficit--difference between imports and exports--in April-August of 2010-11 is USD 56.6 billion. - Indian Express