India’s merchandise exports experienced a significant rise of 23.04 per cent year-on-year, reaching $44.40 billion in September 2026. This figure represents an increase from $36.08 billion recorded in the same month the previous year, as reported by the Ministry of Commerce and Industry on Thursday. The growth in exports is attributed to higher shipments of electronic goods, petroleum products, engineering goods, chemicals, and agricultural products.

Commerce Secretary Rajesh Agrawal highlighted that the growth in merchandise exports was a driving force behind the overall increase in export figures. He noted during a press briefing that the current month’s exports were notably higher compared to those of September last year. The acceleration in export growth was particularly evident in the second quarter of the financial year.

The year saw an overall increase of 15.84 per cent compared to 11.84 per cent in the first quarter. Overall exports, which include both merchandise and services, grew to an estimated $80.75 billion in September, up from $72.76 billion a year earlier. This indicates a robust performance across various sectors, contributing to the positive trade outlook for India.

Imports Rise Amid Narrowing Trade Deficit

India’s merchandise imports rose to $74.61 billion in September, increasing from $69.08 billion recorded in the same month last year. The trade deficit for merchandise narrowed to $30.21 billion, down from $33 billion in September 2025. This figure was slightly below the expectations of economists.

They had anticipated a deficit of $30.4 billion, according to a Reuters poll. Despite the narrowing trade gap, the overall imports for the month showed an increase compared to previous months, with a rise from $70.67 billion in August. The increase in imports has been influenced by global energy prices, which remain high due to ongoing geopolitical tensions, particularly in the Middle East.

Brent crude futures have consistently stayed above $100 a barrel, largely due to the conflict in Iran and increased military actions around the Strait of Hormuz. These factors have contributed to the rising costs reflected in India’s import bill.

India’s Efforts to Expand Export Markets

India is actively seeking to diversify its export markets through various trade agreements with key partners. A trade deal with New Zealand is set to come into effect next week, while an existing trade pact with Britain is already operational. Additionally, negotiations for a broader agreement with the European Union are progressing towards implementation.

The United States continues to be India’s largest destination for merchandise exports, despite challenges related to tariffs. During the first half of the current financial year, India’s merchandise exports to the US increased by 11.1 per cent, amounting to $50.81 billion compared to $45.73 billion in the same period last year. Imports from the US also rose significantly by 26 per cent, reaching $32.33 billion.

Agrawal mentioned that negotiations for a proposed India-US trade agreement are advancing positively, with both countries aiming to conclude the deal as soon as possible. The finalisation of this agreement is contingent upon the broader US tariff framework, which is currently under review. India is seeking preferential access to the US market to enhance its exporters’ competitiveness against foreign counterparts.

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