India’s Exports Rise 6.7% in August, Trade Deficit Narrows on Sharp Drop in Gold Imports

New Delhi, September 15, 2025 – India’s merchandise exports increased by 6.7% on a year-on-year basis to USD 35.1 billion during August 2025, even as global uncertainties and high double-digit US tariffs on various Indian products weighed on the sector. Imports dipped 10.12% to USD 61.59 billion, relieving pressure on the country’s trade balance.

The decline in imports, anchored by a sharp 56.7% decline in gold imports to USD 5.43 billion, assisted in reducing the merchandise trade deficit to USD 26.49 billion, against USD 35.64 billion in August 2024.

Key Export Destinations

The US was India’s biggest export market in August with exports worth USD 6.86 billion, up by 7.15% from the previous year, even as a 25% reciprocal duty came into effect from August 7. But exports to the US reached a nine-month low in August. The US imposed an additional 25% tariff from August 27, increasing the total duty to 50%.

Other major destinations were:

• UAE: USD 3.24 billio
• Netherlands: USD 1.83 billion
• China: USD 1.21 billion
• UK: USD 1.14 billion

Major Import Sources

India continued to import the majority of its imports from:

• China: USD 10.91 billion
• Russia: USD 4.83 billion
• UAE: USD 4.66 billion
• US: USD 3.6 billion
• Saudi Arabia: USD 2.5 billion

Merchandise and Services Trade Combined

Cumulative merchandise and service exports reached USD 69.16 billion in August, above USD 63.25 billion last year. Imports dropped to USD 79.04 billion from USD 84.99 billion, reducing the total trade deficit to USD 9.88 billion.

For April to August 2025, the cumulative exports were USD 349.35 billion, an increase of 6.18% from USD 329.03 billion during the corresponding period last year. Services exports in August alone stood at USD 34.06 billion, and imports were USD 17.45 billion, resulting in a services trade surplus. The Department of Commerce explained that services trade figures for August are preliminary and will be revised when the Reserve Bank of India provides revised figures.

Export Growth Drivers

Major segments contributing to export growth in August were:

• Engineering goods: USD 9.9 billion
• Electronic goods: USD 2.93 billion
• Gems & jewellery: USD 2.31 billion
• Petroleum products: USD 4.48 billion
• Drugs & pharmaceuticals: USD 2.51 billion

Import Trends

Major imports in August were:

• Petroleum products: USD 13.26 billion
• Electronic items: USD 9.73 billion
• Chemicals: USD 2.49 billion
• Vegetable oils: USD 2 billion
• Fertilisers: USD 1.65 billion
• Coal, coke & briquettes: USD 2 billion
• Non-petroleum, non-gems and jewellery imports were at USD 41.02 billion, more or less steady compared to USD 41.41 billion the previous year.

Services Trade Surplus

From April to August 2025, services exports were worth USD 165.22 billion, while imports were at USD 84.25 billion, leading to a surplus of USD 80.97 billion, higher compared to USD 68.25 billion during the same period last year.

Industry Reaction

Commerce Secretary Sunil Barthwal stated that exports have remained strong despite global headwinds and added that recent GST-based reforms will further enhance competitiveness. The fall in imports and the narrowing of the deficit were referred to as encouraging trends. However, exporters demanded more policy support for MSMEs and the timely release of incentives to ensure competitiveness amid major economies’ tariff challenges.

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