Representational file image.
| Photo Credit: Reuters

Exports were worth $32.89 billion in August last year and imports stood at $68.53 billion. (Representational image)
| Photo Credit: Getty Images/iStockphoto

Steady growth of exports — merchandise and services — in the first nine months of FY 25 to touch $ 602.6 billion indicates India’s resilience in the midst of global headwinds of economic and trade policy uncertainties, said the Economic Survey 2024-2025.

However, challenges remained due to elevated geo-political risks, high freight costs, and imposition of climate change related non tariff measures by the European Union in the form of the Carbon Border Adjustment Mechanism (CBAM) and European Union Deforestation Regulation (EUDR).

Also read | Focus on business reforms, private sector R&D: Economic Survey

The CBAM and EUDR were expected to affect $9.5 billion of India’s exports to the EU, which amounted to 9% of India’s exports to the world or 12.9% of India’s exports to the EU.

Further, there was an indication of preference for bilateral trade between countries with similar geopolitical stances, i.e., friend-shoring and nearshoring. There was also an increasing concentration of global trade to favour significant trade relationships.

“The evolving global trade dynamics, marked by gradual shifts towards greater protectionism, require assessing the situation and developing a forward-looking strategic trade road map. By adapting to these trends and leveraging its strengths, India can accelerate its growth and enhance its presence in global trade.”

Also read | Economic Survey 2024-25: Key takeaways in charts

Proactive approach

To strengthen its competitiveness and further integrate into global supply chains, India should focus on reducing trade related costs and enhancing export facilitation to create a more vibrant export sector. This proactive approach will help India continue to thrive in an ever-changing global market, the Survey added.

Total imports during April-December 2024 reached $682.2 billion, registering a YoY growth of 6.9%. A more significant increase in overall imports compared to exports led to a rise in the overall trade deficit from $69.7 billion during April-December 2023 to $79.5 billion in the corresponding period of FY25.

Regarding short, medium and long-term measures, the Survey said that the evolving trade stance of a few major economies could affect key Indian export sectors such as chemicals, machinery, textiles, and electronics. It was essential to diversify the export markets, focus on increasing the market share, and position itself as a strategic partner in high-value sectors like biotechnology and semiconductors.

“Strategic technology partnerships would provide opportunities for enhanced cooperation in key areas such as space, semiconductors, quantum technologies and advanced telecommunications.”

The CBAM and EUDR posed twin challenges for countries such as India. There was a need to achieve higher levels of economic development and deal with climate change mitigation and adaptation, the Survey opined.

Image used for representative purpose only.
| Photo Credit: Reuters

India’s merchandise exports dipped by about one per cent to $38.01 billion in December 2024 against $38.39 billion a year ago, according to government data released on Wednesday (January 15, 2025).

Imports increased by 4.8% to $59.95 billion in December 2024 compared to $57.15 billion in the year-ago month.

The trade deficit, or the gap between imports and exports, stood at $21.94 billion during the month under review.

During April-December this fiscal, exports increased by 1.6% to $321.71 billion and imports by 5.15% to $532.48 billion.

India’s merchandise exports fell 4.83% to $32.11 billion in November. File photo
| Photo Credit: PTI

India’s merchandise exports fell 4.83% to $32.11 billion in November while the import bill jumped 27% to a record high of almost $70 billion, as per data released by the Commerce Ministry.

The trade deficit has also soared to a fresh all-time high of $37.84 billion, reflecting a 77.5% spike over the deficit recorded in November 2023.

This is the third time in four months that India’s import bill has hit a record high, but November’s tally surpasses the last two occasions by a wide margin.

In August, imports had hit a high of $64.34 billion, which was subsequently eclipsed by October’s tally of $66.34 billion.

Commerce Secretary Sunil Barthwal attributed the dip in merchandise exports to an unprecedented fall in petroleum products’ prices which have affected India’s oil exports. “Non-petroleum exports have grown at a comfortable pace and that is what we should be looking at,” he said.

Non-petroleum products exports were up 7.8% in November to touch $28.4 billion, while they have risen 7.4% between April and November this year to reach $239.7 billion.

November’s export performance comes after a surprise 17.25% spike in October, the fastest in 28 months, had lifted exports to the year’s second-best tally of $39.2 billion.

On a month-on-month basis, November’s exports are 18.1% lower.

Petroleum exports in November dropped about 49% but officials said that petroleum products’ export volumes had grown 9.6% between April and October, so the dip in export values is linked to the decline in oil prices alone.

Non-petroleum and services exports are going to sustain in the coming months and we are going to surpass the $800 billion export tally in 2024-25, Mr. Barthwal asserted.

India’s merchandise exports have grown 2.55% in June to $35.2 billion. Image for representation purposes only. File
| Photo Credit: S. Siva Saravanan

India’s merchandise exports have grown 2.55% in June to $35.2 billion, while imports have risen 5% to $56.2 billion, Commerce Secretary Sunil Barthwal informed on July 15.

Total merchandise and services exports have hit a record high of $200.3 billion in the first quarter of 2024-25, he said.

The trade deficit, or the gap between imports and exports, during the month under review stood at $20.98 billion.

Briefing media on the data, Mr. Barthwal said going by the current trend, the country’s total exports of goods and services may cross $800 billion this fiscal.

India’s merchandise exports rose by 9.1% to $38.13 billion in May, even as the trade deficit widened to a seven-month high of $23.78 billion.

Exports during April-June this fiscal increased 5.84% to $109.96 billion, and imports grew 7.6% to $172.23 billion.

(With PTI inputs)

Union Commerce and Industry Minister Piyush Goyal.
| Photo Credit: ANI

India’s exports have recorded healthy growth in May and remained in the positive zone in June and the first quarter of the current fiscal despite global challenges, Commerce and Industry Minister Piyush Goyal has said.

He also said that growth in the services sector is helping the country’s outbound shipments to register positive growth rates.

“In May, exports were positive, the figure for June is also positive. The first quarter is also in the positive territory,” Mr. Goyal told PTI.

India’s merchandise exports rose 9.1% to $38.13 billion in May. During April-May this fiscal, the outbound shipments grew by 5.1% to $73.12 billion.

The Commerce Ministry will officially release the export data for June on July 15.

“Despite the ongoing two wars (Russia-Ukraine and Israel-Hamas), the Red Sea crisis, and container shortage issues, our exports are in a positive zone. One more advantage that we have is the fast pace growth in the services exports,” the Minister said.

He added that the services sector has received a boost from the government’s Digital India mission.

“The roll-out of 4G and 5G in the country too is helping the services exports of India,” Mr. Goyal noted.

Last month, the Minister stated that India’s goods and services exports are expected to cross $800 billion this fiscal despite global challenges. In 2023-24, the shipments stood at $778.2 billion (goods $437.1 billion and services $341 billion).

When asked about foreign direct investments (FDI) into the country, he said the inflows would increase once the international recessionary conditions start improving and interest rates in the U.S. and Europe start coming down.

Irrespective of this situation, India is continuously receiving FDI, he added.

The U.S. and other developed countries have high interest rates, and because of that, those markets are profitable to invest in.

The Commerce Minister added that a healthy infusion of funds by foreign portfolio investments (FPIs) in India reflects greater confidence of investors in India despite high interest rates in developed economies.

FPIs in June infused ₹26,565 crore in Indian equities, driven by political stability and a sharp rebound in markets.

FDI equity inflows in India declined 3.49% to $44.42 billion in 2023-24. Inflows during January-March FY24, however, rose by 33.4% to $12.38 billion against $9.28 billion in the year-ago period.

The total FDI — which includes equity inflows, reinvested earnings and other capital — declined marginally by one per cent to $70.95 billion during 2023-24 from $71.35 billion in 2022-23, data from the Department for Promotion of Industry and Internal Trade (DPIIT) showed.

Union Minister of Commerce and Industry Piyush Goyal. File
| Photo Credit: PTI

We are very confident that the Indian economy is poised for both healthy and organised growth and providing opportunities to lakhs of people across India, Union Minister Piyush Goyal said

Healthy increase in the country’s exports, improvement in the current account deficit (CAD) and focus on expanding manufacturing will help the Indian economy register a healthy growth rate, Union Commerce and Industry Minister Piyush Goyal has said. He was here to participate in a programme of the gems and jewellery industry.

The Minister expressed confidence that India’s goods and services exports would cross $800 billion this fiscal. It was $778 billion in 2023-24 and USD 776 billion in 2022-23.

Mr. Goyal said that the mood amongst industry and exporters is “wonderful” and a “very great” sense of confidence is there among the investors about the India growth story.

“I think this year we will end with over $800 billion exports…We also focus a lot on expanding our manufacturing capacities, so that our import dependencies can come down and CAD is also showing healthy improvement in the last few months. We are very confident that the Indian economy is poised for both healthy and organised growth and providing opportunities to lakhs of people across India,” the Minister told PTI.

S&P Global Ratings has retained India’s GDP growth forecast for the current financial year at 6.8% and said high interest rates and lower fiscal spur would temper demand.

While another rating agency Fitch estimates India’s growth at 7.2% in FY25, the Asian Development Bank (ADB) estimates India’s GDP to grow at 7%.

Moody’s Ratings and Deloitte India estimates India’s GDP to grow at 6.6% in 2024-25 fiscal, while Morgan Stanley projects a growth rate of 6.8%.

When asked if the Ministry is looking at bringing an amendment bill on special economic zones (SEZs), Mr. Goyal said that several suggestions are on the table and are under consideration.

India recorded a current account surplus of $5.7 billion or 0.6% of GDP in the March quarter. This is the first time in ten quarters that the crucial metric of the country’s external strength has turned into surplus mode.

In the year-ago period, the current account deficit stood at $1.3 billion or 0.2% of GDP, and the same was $8.7 billion or 1% of GDP in the preceding quarter ending December 2023.

India’s merchandise exports rose by 9.1% to $38.13 billion in May even as the trade deficit widened to a seven-month high of USD 23.78 billion during the month, according to the latest government data.

The textile sector grew 9.8% in May, after months of sluggishness. File
| Photo Credit: M. Periasamy

India’s goods exports grew 9.1% to $38.13 billion in May, while imports rose 7.7% to $61.91 billion, Commerce Secretary Sunil Barthwal said on Friday, stressing that things are looking “more optimistic for foreign trade this year”. Even the textiles sector recorded a healthy growth of nearly 10% in May “after several months of sluggishness”, he noted.

However, despite exports growing faster than imports, the merchandise trade deficit surged to a seven-month high of $23.78 billion in May. This was 5.5% higher than the deficit recorded in May 2023, and 24.5% over April’s trade gap of $19.1 billion, which in turn was the highest in four months. Compared with April, May’s import bill was 14.4% higher, while the value of exports rose 8.9%.

Asked if the rising trade deficit could pose a problem, Mr. Barthwal told The Hindu that the trend must be seen in the context of India growing faster than the world, insisting that goods trade deficits should not be viewed in isolation.

High growth, high demand

“Our economy is growing over 7%, while the global economy is growing at about 2.6% so there will always be higher demand from our country for imports of certain kinds of items. When your economy is growing faster than the world, then obviously there will be these twin effects — higher domestic demand will mean less exportable surplus, and your requirements for imports from the rest of the world will be higher than the world’s requirements from you,” he noted.

“The deficit trends will depend on two factors — import substitution and the rate of economic growth. But I don’t consider trade deficit per se as a bad thing, as long as you have foreign investment coming in through FDI, foreign exchange coming in, and you are balancing it through other means. Moreover, if our services exports are growing, we should not be unnecessarily worried about merchandise trade deficit alone,” the Commerce Secretary asserted.

The top Commerce official also highlighted the healthier 7.4% growth in exports of engineering goods in May, with double-digit increases in several segments, including electronics (23%), drugs and pharma products (10.45%), and plastics and linoleum (16.6%).

“We hope this trend should continue this year and also hope that there should be no more geopolitical conflicts and no more disruptions in major global shipping routes,” Mr. Barthwal said.

‘Deficit driven by oil’

Imports of gold hit a three-month high of $3.33 billion in May, although this was 9.7% lower than the gold import bill a year ago. Gold imports had tripled year-on-year in April to $3.11 billion. The value of silver imports shot up by over 400%, while the growth in imports of pulses (181.3%), transport equipment (31.9%), and petroleum (28.1%) also contributed to widening the chasm between exports and imports.

ICRA chief economist Aditi Nayar reckoned that 71% of the month-on-month surge in the trade deficit was driven by the net oil balance. While petroleum imports were $19.95 billion in May, the export figure stood at $6.77 billion.

“With the deficit enlarging by $6 billion in April-May 2024 relative to last year, we expect the current account deficit to rise to around 1.5% of GDP in this quarter from about 1.1% of GDP in the same quarter of 2023-24,” Ms. Nayar said.

Image for representation.
| Photo Credit: The Hindu

The Netherlands has emerged as India’s third largest export destination after the U.S. and UAE during 2023-24, even as the country’s merchandise shipments dipped by over 3%, according to the Commerce Ministry data.

The main commodities which registered healthy exports growth in the Netherlands include petroleum products ($14.29 billion), electrical goods, chemicals, and pharmaceuticals in the last fiscal.

India’s trade surplus with the Netherlands has increased to $17.4 billion in the last fiscal from $13 billion in 2022-23.

The Netherlands has taken over major destinations such as the U.K., Hong Kong, Bangladesh and Germany.

India’s exports to the Netherlands rose by about 3.5% to $22.36 billion in 2023-24 as against $21.61 billion in 2022-23, the data showed.

In 2021-22 and 2020-21, the outbound shipments to the European country stood at $12.55 billion and $6.5 billion, respectively.

The exports have been registering healthy growth continuously since 2000-01, when India’s exports to that nation were $880 million.

Further, in 2021-22, the Netherlands was the fifth largest destination for Indian exports as against the ninth largest in 2020-21.

According to trade experts, the Netherlands has emerged as a hub for Europe with efficient ports and connectivity with the EU through roads, railways and waterways.

Mumbai-based exporter and Chairman of Technocraft Industries Sharad Kumar Saraf said the trend of increasing exports would continue in the future also.

Saraf said that the Netherlands is a gateway to Europe as its ports are very efficient.

India and the Netherlands established diplomatic relations in 1947. Since then, the two countries have developed strong political, economic and commercial relations.

In 2023-24, the bilateral trade between the two countries marginally dipped to $27.34 billion as against $27.58 billion in 2022-23.

The Netherlands is among the top trading partners of India in Europe, after Germany, Switzerland, the U.K. and Belgium.

It is also a major investor in India. During the last fiscal, India received about $5 billion in foreign direct investment from the Netherlands. It was $2.6 billion in 2022-23.

There are over 200 Dutch companies present in India, including Philips, Akzo Nobel, DSM, KLM and Rabobank. Similarly, there are more than 200 Indian companies operating in the Netherlands, including all the major IT firms such as TCS, HCL, Wipro, Infosys, Tech Mahindra as well as Sun Pharmaceuticals and Tata Steel.