India’s merchandise trade deficit narrows to $26.49 billion in August

India’s merchandise trade deficit for August narrowed to $26.49 billion from $27.35 billion in July as both imports and exports fell, the commerce ministry said on September 15.

Goods exports in August came in at $35.10 billion versus $37.24 billion in July, while imports came in at $61.59 billion, lower than $64.59 in the previous month.

However, compared to August 2024, India’s exports in goods rose 6.7 percent, while imports declined 10.1 percent during last month.

On a year-on-year basis too, the deficit in goods trade has narrowed as against $35.64 billion in August 2024.

“Despite global uncertainties and trade policy uncertainties, Indian exporters have done well. It shows that the government's policy has paid off," Commerce Secretary Sunil Barthwal said.

Major drivers of merchandise exports in August 2025 include electronics, which registered a growth of 25.93 percent on-year, engineering goods that rose 4.91 percent, and gems & jewellery shipments that jumped 15.57 percent.

Reacting to the trade figures, S C Ralhan, President, FIEO, said that the growth in exports for August 2025 is a welcome and encouraging sign, especially in light of ongoing global headwinds and geopolitical uncertainties. The decline in imports by over 10 percent has also helped in easing the trade deficit, which is now significantly lower compared to the same month last year.

On a cumulative basis, during April-August, merchandise exports stood at $184.13 billion, while imports were recorded at $306.52 billion – both higher from a year ago period.

Therefore, the gap in goods trade during April-August 2025 was wider at $122.39 billion as compared to $120.52 billion during the same period in the previous fiscal.

On the services side, the estimated value of exports for August 2025 is $34.06 billion as compared to $30.36 billion in the same month last year, while imports are seen at $17.45 billion as versus $16.46 billion.

Therefore, overall exports (merchandise and services combined) for August 2025 are estimated at $69.16 Billion, up 9.3 percent on year, while total imports are seen at $79.04 billion, a fall of 7 percent.

The overall trade surplus, including services last month, is seen at $9.88 billion, smaller than the $21.73 billion posted in the same month last year.

During April-August 2025, exports in services is estimated at $165.22, 10.6 percent higher on year, while imports in the category are also seen rising to $84.25 billion, up 3.8 percent.

The services trade surplus for April-August 2025 is seen at $80.97 billion as compared to $68.25 billion in April-August 2024.

Therefore, the trade surplus for the current financial year till August stood at $41.42 billion.