Imports
Imports means goods and different services bought from another nation. For example, industrialized nations generally import oil from the OPEC nations. The term “imports” also indicates the economic value of goods and services purchased from abroad.
Components
Generally, the imports are composed of different agricultural products including wheat, corn, rice, oil, petroleum, equipment, intermediate services, machinery and metals. The imports generally contribute to the domestic consumption by raising the purchase of consumer goods and services. It also adds to domestic investment by improving the production capabilities with new equipment and tools. Lastly, it pays to the domestic production through a raised supply of spare parts and raw materials.
Importance
Imports affect the trade balance of a country. A trade surplus takes place when the imports of the country are less compared to the exports whereas the trade deficit takes place when the imports are more than the exports. If a trade deficit takes place, it generally implies that the local production is weak as the demand for services and goods is more than the claim for domestic services and goods. This can translate the weaker employment and finally lowers consumption.