India’s trade deficit widened to $26.42 billion in April 2025, up from $21.54 billion in March, according to preliminary trade data released by the Ministry of Commerce and Industry on May 15. The surge in imports—especially of crude oil, electronics, and machinery—outpaced export growth, driving the gap.
Exports (excluding services) rose 9% year-on-year to $38.49 billion. Leading this growth were engineering goods, up 11.3% to $9.51 billion, followed by petroleum products ($7.37 billion, +4.7%), electronics ($3.69 billion, +39.5%), jewelry ($2.5 billion, +10.7%), and pharmaceuticals ($2.49 billion, +2.4%). However, exports of organic and inorganic chemicals fell 9.1% to $2.27 billion.
Imports surged 19.1% to $64.91 billion, driven largely by petroleum and crude oil imports, which climbed 25.6% year-on-year to $20.72 billion—making up nearly 30% of total imports. Electronics imports jumped 31.2% to $9.25 billion, while imports of electrical and general machinery rose 23.2% to $4.67 billion. Gold imports increased 4.9%, and chemical imports rose 10.9% to $2.45 billion. Conversely, coal and coke imports dropped 12.3% to $2.71 billion, while transport equipment imports saw a modest 3.2% increase to $2.6 billion.
Despite the growing deficit, officials remain optimistic. Pankaj Chadha, chairman of the Engineering Export Promotion Council (EEPC), pointed to new trade deals as growth drivers. He highlighted the recently concluded free trade agreement (FTA) with the UK and ongoing negotiations for a bilateral trade agreement (BTA) with the US. Chadha expects these deals to significantly boost India’s engineering exports.
On May 6, India finalized its FTA with the UK, expected to reduce trade barriers and open new markets. Meanwhile, the US imposed a global baseline tariff of 10% starting April 5 and announced reciprocal tariffs of 26% on Indian goods, effective after a 90-day grace period. Current negotiations aim to soften these measures and establish a bilateral agreement.
India’s trade outlook hinges on how global trade relations evolve and whether export growth can keep pace with surging imports, especially of energy and technology products.
