India’s Merchandise Exports Remain Flat in June at USD 35.14 Billion; Trade Deficit Hits Four-Month Low

New Delhi, July 16: India’s merchandise exports held steady in June 2025 at USD 35.14 billion, reflecting the persistent impact of global economic headwinds. Despite this stagnation in exports, the country’s trade deficit narrowed to a four-month low of USD 18.78 billion. This improvement in the trade balance was primarily driven by a notable decline in imports, according to official data released today.

Compared to June 2024, when exports stood at USD 35.16 billion, the current month saw a negligible contraction, indicating a period of stabilisation rather than growth for merchandise shipments.

Imports Fall on Lower Oil and Gold Shipments

The decline in imports was a key factor in the narrowed trade deficit. Imports dropped by 3.71% year-on-year to USD 53.92 billion in June. This reduction was largely attributable to reduced inbound shipments of crude oil and gold.

• Crude oil imports were down by 8.37% to USD 13.8 billion.
• Gold imports plummeted by 25.73% to USD 1.9 billion.

Despite the dip in imports, the overall trade dynamics continue to highlight the ongoing pressure on India’s traditional export sectors due to global demand conditions.

Export Performance Mixed Across Sectors

While overall exports remained flat, a mixed performance was observed across different sectors:

Key Export Categories with Negative Growth:

• Petroleum products (down 15.92% to USD 4.61 billion)
• Fabrics
• Gems and jewellery (overall decline, though gold jewellery saw growth)
• Leather
• Iron ore
• Oil seeds
• Cashew
• Spices
• Tobacco
• Coffee

Sectors Posting Encouraging Gains:

• Electronic goods surged by 46.93% to USD 4.14 billion, demonstrating strong growth and emerging as a significant contributor.
• Engineering goods
• Pharmaceuticals
• Marine products
• Chemicals
• Rice
• Ready-made garments

For the first quarter of fiscal year 2025-26 (April-June), electronic goods exports continued their robust performance, rising by 47.11% to USD 12.4 billion.

Q1 FY26 Trade Snapshot

• Exports: Up 1.92% to USD 112.17 billion
• Imports: Up 4.24% to USD 179.44 billion
• Merchandise trade deficit: Widened to USD 67.26 billion from USD 62.10 billion in Q1 FY25

Commerce Secretary Sunil Barthwal indicated that India’s combined goods and services exports for Q1 FY26 are estimated at USD 210 billion, marking a 6% year-on-year rise. “If the growth continues like this, then we are going to cross last year’s exports figures,” Barthwal stated, referencing India’s all-time high exports of USD 825 billion in FY25.

Services Sector Maintains Strong Momentum

The services sector continued to be a strong performer, providing a crucial buffer to the overall trade balance.

• The estimated value of services exports in June 2025 stood at USD 32.84 billion, up from USD 28.67 billion in June 2024.
• Services imports were pegged at USD 17.58 billion, compared to USD 15.14 billion a year earlier.
• The services trade surplus for April-June 2025 increased to USD 46.95 billion, up from USD 39.68 billion in April-June 2024.

S.C. Ralhan, President of the Federation of Indian Export Organisations (FIEO), emphasised the importance of a targeted export strategy, particularly for the services sector. He highlighted India’s digital capabilities and skilled workforce as immense opportunities to boost services exports.

Road Ahead

Trade analysts observe a mixed outlook for India’s trade. While high-import intensity sectors like electronics are gaining significant traction, traditional labour-intensive export segments continue to face subdued demand. As the global trade environment increasingly leans towards protectionism, India’s export strategy will necessitate careful calibration to adapt to evolving international dynamics and leverage its strengths.

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