Key Takeaways
- Indian exporters recorded a 26% rise in goods shipments during August.
- The US remained a major market, with exports rising 21%.
- Lower gold imports helped reduce pressure on India’s trade deficit.
India goods exports rose 26% to $43.81 billion in August, compared with $34.74 billion a year earlier. Shipments to the US increased more than 21% to $8.3 billion from $6.8 billion, marking the sharpest monthly rise in exports to the market this calendar year. A weaker rupee and lower gold imports also influenced August trade figures.
US Shipments Drive August Export Growth
The US accounted for a major part of the increase in India goods exports during August. Exports to the country rose by more than $1.5 billion compared with August 2025.
India goods exports were affected by higher US tariffs during August 2025. The first 25% reciprocal tariff took effect on August 7, 2025, followed by another 25% tariff on August 27. The combined tariff reached 50% at that point. India’s exports to the US are facing a 10% tariff compared with the level seen during the same period last year.
The domestic currency also depreciated by more than 10%, supporting export growth. The effect of currency depreciation can vary across industries, depending on their margins, imported inputs, and overseas demand.
High technology exports have shown a stronger response to currency depreciation. Machinery, electronics, and transport products have recorded higher gains following a weaker rupee. Food and marine products have also shown a positive response, while some mid-technology categories have seen limited effects.
During the April to June quarter, engineering goods exports increased 18.1%, electronics exports rose 22.6%, and pharmaceutical exports grew 6.8%. Several labour-intensive categories, however, recorded declines during the period.
Textile exports fell 12.4%, while leather product exports declined 4.7%. Shipments of fruits and vegetables, ceramics and glassware, and jute products fell 10.3%, 25%, and 13.4%, respectively. Tea exports declined 17.5%. Of 31 export sectors, 11 recorded declines during the quarter.
Lower Gold Imports Ease Trade Deficit
Goods imports rose 14.05% to $70.67 billion in August from $61.96 billion a year earlier. The slower growth in imports compared with exports helped reduce the merchandise trade deficit.
The trade deficit stood at $26.86 billion in August, compared with $27.20 billion in August 2025.
Gold imports recorded a sharp decline during August. Imports fell to $2.30 billion from $5.44 billion a year earlier. This was the first major decline in gold imports during the ongoing financial year.
Petroleum and energy products, electronic goods, and other industrial inputs continued to account for significant import demand. These imports reflected domestic production and consumption requirements.
Automobile exports also increased 22.2%, supported by higher shipments of two-wheelers and three-wheelers. Gems and jewellery exports rose 3.14% to $2.30 billion.
Export growth was also recorded across markets including, China, Singapore, Germany, South Africa, Malaysia, Tanzania, Hong Kong, Australia, Spain, and Sri Lanka. Electronics and engineering products continued to contribute to export activity, alongside chemicals and pharmaceuticals.
For Indian businesses, the August data shows stronger goods export activity alongside slower import growth. The figures also show different performance levels across export categories, with engineering, electronics, pharmaceuticals, and automobiles recording growth while several labour-intensive sectors reported declines.
