Riding on robust electronic goods exports, India narrowed its trade deficit in August as imports dropped sharply, driven by a steep fall in gold purchases.
Electronic goods emerged as one of India’s strongest export drivers in August, rising to $2.93 billion, government data showed on Monday. Alongside engineering goods at $9.9 billion, petroleum products at $4.48 billion, pharmaceuticals at $2.51 billion, and gems and jewellery at $2.31 billion, electronics helped lift overall merchandise exports by 6.7% to $35.1 billion.
Imports, on the other hand, contracted by 10.12% to $61.59 billion. This decline, led by a steep 56% fall in gold imports to $5.43 billion, narrowed the merchandise trade deficit to $26.49 billion, compared with $35.64 billion the previous year.
The United States retained its position as India’s top export market at $6.86 billion, followed by the UAE at $3.24 billion, the Netherlands at $1.83 billion, China at $1.21 billion, and the UK at $1.14 billion.
On the import front, China remained dominant, with a value of $10.91 billion, followed by Russia ($4.83 billion), the UAE ($4.66 billion), the US ($3.6 billion), and Saudi Arabia ($2.5 billion), which completed the list of leading suppliers.
Combined merchandise and services exports reached $69.16 billion in August, up from $63.25 billion a year earlier. Imports fell to $79.04 billion from $84.99 billion, leaving a total trade deficit of $9.88 billion.
For the April–August 2025 period, cumulative exports of goods and services were estimated at $349.35 billion, compared with $329.03 billion in the year-ago period, reflecting a 6.18% rise. Service exports alone rose to $34.06 billion, while imports were valued at $17.45 billion.
Among imports, petroleum products led with $13.26 billion, followed by electronic goods at $9.73 billion, chemicals at $2.49 billion, and coal and vegetable oils at around $2 billion each.
FIEO President S C Ralhan described the 6.7% export growth as a positive sign. He said the fall in imports has eased the deficit but urged stronger support for MSMEs and faster disbursement of incentives.
