India's Trade Tally: Robust Exports Struggle Against Rising Imports

Despite notable export growth, India's trade deficit widened in May 2026 due to a sharper rise in imports. Both merchandise and services expanded, but import bills surpassed export gains, leading to a USD 10.51 billion deficit. The data highlights strong domestic demand amid rising commodity prices.

In May 2026, India's trade deficit widened despite significant growth in exports, as reported by the Ministry of Commerce and Industry's estimated trade data. Although both merchandise and services trade showed year-on-year expansion, a surge in imports overshadowed export gains.

Overall trade, combining both sectors, exhibited a rise in exports to USD 81.96 billion from USD 70.76 billion in May 2025, demonstrating robust growth. However, with imports increasing to USD 92.47 billion from USD 77.55 billion, the trade deficit expanded to USD 10.51 billion from the previous year's USD 6.79 billion.

Merchandise exports reached a record high of USD 45.20 billion, while imports soared to USD 73.41 billion, keeping the goods trade gap a crucial concern. Services trade also performed well, with exports estimated at USD 36.76 billion against imports of USD 19.06 billion. The overall trend suggests strong external demand for Indian products amidst rising domestic consumption and higher commodity prices, warranting attention on the widening deficit.