India logged the second straight month of growth in exports in December, even as the trade deficit widened, led by a sharper jump in imports, especially gold, trade data published by the commerce ministry showed.
Exports stood at $38.51 billion, rising by 1.9 per cent from a year earlier. In November, exports had jumped 19.4 per cent, the fastest pace in more than three years. The resilience was largely supported by India’s push into markets in West Asia and North Africa, ministry data showed.
Rise in imports, however, outpaced exports as it climbed by 8.8 per cent in December from a year earlier to $63.55 billion. As a result, India’s trade deficit widened to $25.04 billion in December from $24.53 billion a month earlier.
The data showed gold imports stood at $4.1 billion in December, compared with $4.02 billion in November, while oil imports stood at $14.4 billion last month.
A widening deficit would add pressure on the already weak rupee, weighed down by capital outflows and uncertainty over the timing of a US trade deal.
Export to the US
India, which remains one of the few major economies without a trade deal with the US, and is subject to a 50 per cent tariff on merchandise export, reported a 9.75 per cent year-on-year increase to $65.88 billion in the first nine months of the fiscal year. However, in December, exports to the US edged down to $6.89 billion from $6.92 billion in November.
“US exports have grown year-on-year in the first nine months of the (fiscal) year,” Rajesh Agrawal, commerce secretary, told reporters, adding total exports could be more than $850 billion in FY26.
Commenting on the progress of the trade deal with the US, the commerce secretary said negotiating teams are talking “virtually” and that discussions have not broken down.
“(I) can’t put a deadline to the US deal, will happen when both sides are ready,” Agrawal said.
He argued India has managed to “hold on well” in exports to the US despite the tariffs.
He cited electronics exports to the US as one of the key reasons for that as this sector is not covered under the additional tariffs. Going forward, we hope to remain in positive territory,” he said, while acknowledging that the tariff would “stress” sectors such as textile and leather.