Merchandise Exports Hit 10-Year High as Trade Deficit Narrows Sharply Despite US Tariffs

India’s trade deficit narrowed sharply to $24.53 billion in November, down from $41.68 billion in October, driven largely by a decline in gold, crude oil and coal imports, according to government data released on Monday.

Overall trade—covering both merchandise and services—recorded exports of $73.99 billion in November 2025, a sharp jump from $64.05 billion in the same month last year. Imports during the period edged down marginally to $80.63 billion from $81.11 billion.

As a result, the overall trade deficit narrowed to $6.64 billion in November 2025, compared with $17.06 billion in November 2024, signalling a meaningful improvement in India’s external trade position.

The merchandise sector led the turnaround. Merchandise exports surged to $38.13 billion, up from $31.94 billion a year ago—marking the highest monthly export level in over a decade. Merchandise imports moderated during the same period, declining from $63.87 billion to $62.66 billion, amplifying the positive impact of export growth on the trade balance.

The services sector also remained resilient. Services exports rose from $32.11 billion in November 2024 to $35.86 billion in November 2025, underlining the continued strength of India’s services-led external sector. Services imports increased marginally from $17.25 billion to $17.96 billion.

Commerce Secretary Rajesh Agrawal highlighted the significance of the milestone. “Our record merchandise export stood at $38.13 billion, the highest in the last ten years. In November, we have never crossed the $38 billion mark before,” he said.

Agrawal also pointed to easing import pressures. “Imports are down by 1.88%. While the longer-term import trend remains positive, this month saw a contraction of nearly 1.8%, which needs to be viewed in context,” he added.

The merchandise trade deficit alone narrowed from $31.92 billion last year to $24.53 billion, a development Agrawal described as a “positive story” for November. He said export growth was driven primarily by engineering goods (up 23.8%), electronic goods (up 39%), and gems and jewellery (up 27.8%).

The data also revealed a notable rise in exports to China during April–November 2025. Merchandise exports to China increased from $9.20 billion in the same period last year to $12.22 billion, reflecting a growth of nearly 32.8%.

On a monthly basis, exports to China showed an overall upward trajectory despite interim fluctuations. Shipments stood at $1.39 billion in April 2025, climbed to $1.62 billion in May, eased to $1.37 billion in June, and moderated further in July ($1.34 billion) and August ($1.21 billion), indicating a temporary mid-year slowdown.