India’s trade deficit eased to $18.78 billion in June 2025, a notable improvement from $21.88 billion in May, according to the latest data released by the Ministry of Commerce and Industry on Tuesday.
The contraction in the trade gap was driven primarily by a decline in imports, which fell by 3.71% year-on-year to $53.92 billion from $56 billion in June 2024. In contrast, exports remained nearly flat, clocking in at $35.14 billion, slightly below the $35.16 billion posted in the same month last year.
On the services front, India recorded a healthy estimated surplus of $15.62 billion in June, with services exports standing at $32.84 billion and imports at $17.58 billion.
Combined, India’s total exports of goods and services for June amounted to $67.98 billion, while overall imports were $71.50 billion, bringing the net trade deficit for the month to $3.51 billion.
Global uncertainty clouds export momentum
Despite a marginal recovery in the trade balance, Commerce Secretary Sunil Barthwal recently acknowledged that geopolitical tensions and global economic uncertainties are affecting India’s export performance. He noted that the government is actively engaging with exporters to address logistical challenges, particularly those related to shipping and insurance.
Trade talks with the US in focus
The trade figures come amid crucial negotiations with the United States and other global partners. Washington is pressing for wider market access for its agriculture and dairy sectors, a sensitive issue for India given its implications for small and marginal farmers.
India, in turn, is pushing for tariff concessions on labour-intensive exports such as textiles, leather, and footwear, and is seeking an exemption from Trump-era tariffs of 26%. While both sides aim to reach an interim agreement, former President Donald Trump has warned of issuing formal tariff notifications as early as this Friday if talks stall.
Broader trade trends show resilience
A separate NITI Aayog report released Monday on Q3 FY25 (October-December 2024) indicated a cautiously resilient trade outlook. Merchandise exports rose 3% year-on-year to $108.7 billion, even as global demand remained volatile.
One standout performer was the aircraft, spacecraft, and parts category, which entered the top ten export items, surging over 200% year-on-year, driven by rising demand from Saudi Arabia, the UAE, and the Czech Republic.
Additionally, high-tech merchandise exports have seen a strong upward trend since 2014, with segments like electrical machinery and arms and ammunition growing at a 10.6% compound annual growth rate, underscoring India’s growing footprint in advanced manufacturing exports.
The trade data reinforces India’s cautious optimism for the second half of FY25, despite ongoing external challenges.