India's Trade Surplus with US Narrows Amid Shifting Dynamics

India's trade surplus with the US shrank in FY 2025-26 due to decreasing export momentum and rising US imports, despite being the top export destination. Exports to China surged, indicating stronger ties, while exports to the Middle East plummeted amid regional disruption.

In the fiscal year 2025-26, India's trade surplus with the United States experienced a notable contraction. This shift comes amid a decline in export momentum, exacerbated by tariff measures previously imposed by former US President Donald Trump, while Indian imports from the US have significantly risen.

Data from the commerce ministry revealed that India's exports to the US grew marginally to USD 87.31 billion, inching up from USD 86.51 billion the previous year. Meanwhile, imports surged to USD 52.90 billion from USD 45.63 billion, reducing the trade surplus to USD 34.41 billion from USD 40.88 billion.

Despite these dynamics, the US remains India's largest export market, followed by countries such as the UAE and China. Exports to China marked significant growth, surging 36.7% to USD 19.48 billion, reflecting stronger trade relations. However, imports from China remained high at USD 131.63 billion, highlighting the reliance on Chinese goods. A noted decline in Middle Eastern trade was reported, largely due to regional conflicts.

(With inputs from agencies.)