India’s merchandise exports surged 26% in August to $43.81 billion on the back of robust export growth in petroleum products, electronics and engineering goods, among other items, according to government data. Merchandise imports, in comparison, grew at a much lower rate of 14.12% to $70.67 billion, resulting in the trade deficit narrowing to $26.86 billion in August.
“This is the first time where you see, in value terms, export growth is higher than imports,” Commerce Secretary Rajesh Agrawal said during a media briefing.
Agrawal further said that the exceptional growth in exports is being driven by a dynamic mix of commodities and key partner countries. “We have seen good performance across engineering goods, petroleum products, chemicals and textiles. At the same time, major demand has come from the US, EU, BRICS nations and emerging economies,” added the Secretary.
While the US retained its position as the top export destination for India, there has been a significant rise in exports to China. In August, exports to China grew by an astounding 52% to $1.8 billion. Imports from the country grew by only 17% during the month. For the April-August period, exports to China rose by 38.6% to $9.6 billion, while imports increased by 27% to $65.5 billion, taking the total merchandise trade deficit with the country to $55 billion.
Meanwhile, imports from the US rose sharply by 65% during the month, even as exports to the country grew by 22%. In the first five months of the financial year, imports from the US have grown by 30%, while exports to the country have risen by just 7%.
However, due to the impact of the West Asia crisis, exports to the UAE fell by 11% to $13.59 billion.
Gold imports have almost halved from $5.44 billion in August last year to $2.30 billion this year. In the April-August period, gold imports showed 14% growth. Silver imports, however, grew by 150% during the month.
Apart from gold imports, the Commerce Secretary said that the surge in imports, which was resulting in a higher trade deficit in the first five months, was primarily due to strong domestic economic expansion, rising energy requirements and the critical inputs needed to sustain the rapid growth of the manufacturing sector.
India’s overall exports, including merchandise and services, have gone up by 25.4% to $82.7 billion in August 2026 from $65.93 billion a year ago. While exports grew by more than 25%, import growth has been relatively slower. Overall imports in August rose by 18.75% to $92.1 billion. As overall export growth surpassed import growth, India’s total trade deficit fell to $9.4 billion in August 2026 from $11.6 billion in August last year.