India’s trade deficit narrows sharply to $3.51 billion in June 2025
Total exports hit $67.98 billion amid robust global demand and rising service sector contributions
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India’s overall trade deficit (merchandise and services) narrowed significantly to $3.51 billion in June 2025, down from $7.30 billion in June 2024, as exports outpaced imports on a year-on-year basis, government data showed on Tuesday.
The decline in the trade deficit reflects stronger export performance, aided by resilient demand in key global markets and robust service sector growth.
The data suggests that overall exports (merchandise and services) rose to $67.98 billion in June 2025, compared to $63.83 billion in the same month last year, with a jump of nearly 6.5 per cent.
Meanwhile, overall imports also saw a marginal rise, reaching $71.50 billion in June 2025 compared to $71.14 billion in same period of the last year, indicating stable domestic demand and softening global commodity prices. The improved trade balance is a positive sign for India’s current account position and broader economic fundamentals.
The country’s trade deficit in May had also narrowed to $6.62 billion from $9.35 billion same month last year.
In May 2025, India’s overall exports, merchandise and services combined, were reported at $71.12 billion, marking a 2.77 per cent rise on a yearly basis. The total exports in May 2024 were pegged at $69.20 billion.
Among various steps the government took to increase exports include the Production Linked Incentive (PLI) scheme in 14 sectors, including electronic goods, telecom, EVs battery to name a few.
The government has set a target of $1 trillion exports for the current financial year 2025-26. The free trade agreements (FTA) signed and under negotiations with various countries will boost exports. The most recent FTA was signed with the United Kingdom and the UAE.
Commerce and Industry Secretary Sunil Barthwal had on Monday said at an Industry summit highlighted the importance of FTAs, Barthwal noted that the “India-UK” FTA has a special chapter on Innovation, thereby strengthening innovation corridors between partner countries. He further added that FTAs ensure regulatory practices and institutional mechanisms between two sets of partners that can be harmonized and sustained.
Published on July 15, 2025
