India’s goods exports increased 6.7 per cent (year-on-year) in August 2025 to $35.10 billion fuelled by sectors such as gem & jewellery, engineering, electronics and petroleum products. Shipments to Washington continued to be front-loaded by exporters to avoid the brunt of US tariffs but there was a slowdown compared to the previous months, per data released by the Commerce & Industry Ministry on Monday.
Trade deficit narrowed significantly to $26.49 billion in August 2025, from $35.64 billion in August 2024, as imports during the month declined 10.12 per cent to $61.59 billion. In July 2025, trade deficit was at $27.35 billion.
Major contributor to the drop in imports in August 2025 was gold, whose shipments declined 56 per cent to $5.4 billion from $12.55 billion in the same month last year.
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“Despite global uncertainty and trade policy uncertainty, Indian exports have done well. It shows the government’s policies have paid off,” Commerce Secretary Sunil Barthwal said at a media briefing on Monday.
India’s exports to the US in August 2025 increased 7.15 per cent to $6.86 billion as exporters continued their effort to send off shipments before US tariffs took effect. The US implemented 25 per cent reciprocal tariffs on most Indian imports on August 7 and another 25 per cent penal tariff on August 27.
Despite the year-on-year increase in exports to the US in August 2025, there was a slowdown as shipments declined from $8 billion exported in July 2025. There are apprehensions that US exports may plunge in the following months as the full blow of the tariffs are felt.
“While the increase in shipments in August shows the industry’s resilience, there are early signs of stress, also due to the punitive tariffs imposed by the US. When compared with July export numbers, engineering exports have recorded a nearly 5 per cent decline. Given that nearly $20 billion of engineering exports are exposed to the US tariff, the sector remains vulnerable,” said Pankaj Chadha, Chairman, EEPC India.
The government must enhance support for MSMEs and make sure export incentives are disbursed timely to ensure exports remain globally competitive especially at a time when the world was facing a tariff crisis, according to exporters’ body FIEO.
In August 2025, India’s exports to the UAE, the Netherlands and China – the top three global markets after the US – also increased.
In April-August 2025, goods exports increased 2.52 per cent to $184.13 billion, while imports rose 2.14 per cent to $306.52 billion. Trade deficit during April-August 2025 was $ 122.39 billion ($120.52 billion).
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Published on September 15, 2025
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