India's cumulative exports rise to $720.76 billion in Apr-Jan 2025-26, up 6.15%
India's cumulative merchandise and services exports for April–January 2025-26 reached $720.76 billion, up 6.15% from $679.02 billion in the same period of 2024-25
Merchandise exports for the 10-month period stood at $366.63 billion (up from $358.75 billion), while services exports contributed a larger share
Total cumulative imports for April–January 2025-26 reached $823.41 billion, growing 6.54% — slightly faster than exports
The merchandise trade deficit for the period widened to $283.23 billion (from $247.38 billion in the previous year)
However, the services trade surplus expanded to $180.58 billion (from $153.56 billion), partially offsetting the merchandise deficit
Balance of Payments (BoP) — Structure and Components
India's Balance of Payments is a systematic record of all economic transactions between Indian residents and the rest of the world in a given period. It is divided into three accounts: the Current Account (trade in goods and services, income, transfers), the Capital Account (capital transfers), and the Financial Account (investment flows, forex reserves).
Key Details
- Current Account Deficit (CAD): India typically runs a CAD because merchandise imports (oil, gold, electronics) significantly exceed merchandise exports; this is partially offset by a services trade surplus and large remittance inflows
- India's services trade surplus: Driven primarily by IT/software exports (45% of services exports), BPO, consulting, and financial services — India is the world's top software exporter by employee count
- Remittances: India is the world's largest remittance recipient (~$125 billion in FY25); remittances are counted under the Current Account (secondary income)
- Capital Account: FDI inflows + FPI (Foreign Portfolio Investment) flows + external commercial borrowings fund the CAD; a "BoP surplus" occurs when the Financial Account surplus exceeds the CAD
- RBI uses forex reserves to manage excess volatility in BoP — India's forex reserves stand at ~$640 billion (among world's top 5 holders)
The April–January data shows merchandise exports growing, but the merchandise trade deficit widening (driven by higher imports), while the services surplus expands — a structural pattern that characterises India's BoP composition and is directly testable in UPSC Prelims.
India's Export Composition — Merchandise vs. Services
India's export basket reflects a distinctive dual structure: manufacturing exports are concentrated in petroleum products, gems & jewellery, chemicals, and engineering goods; while services exports are dominated by IT/software, business process services, and professional services.
Key Details
- Top merchandise exports: Petroleum products (~18-21% of total), gems & jewellery, drug formulations & biologicals, engineering goods, textiles & garments
- Top services exports: Software services (~44%), business services (~18%), travel, transportation
- Export target: Foreign Trade Policy 2023 set a $2 trillion export target by 2030 (merchandise + services combined), with equal contributions from both segments
- India's merchandise export competitiveness: Constrained by high logistics costs (logistics cost as % of GDP ~8-9% vs. 4-5% in advanced economies), limited FTA coverage with EU and US markets, and dependence on imported inputs for manufactured exports
- Gems & jewellery: India polishes 90% of the world's diamonds by volume; vulnerable to global luxury demand cycles
India's total exports reaching $720.76 billion in 10 months, with services surplus growing faster than merchandise deficit, highlights how India's comparative advantage lies increasingly in services — relevant to trade policy and Mains analysis of India's growth drivers.
Foreign Trade Policy (FTP) 2023 and Export Promotion Architecture
India's Foreign Trade Policy 2023 (effective April 1, 2023) replaced FTP 2015-2020 and introduced a more dynamic, responsive framework for export promotion. It shifted from the earlier incentive-based model (where exporters received duty remission on fixed rates) to a more agile, remission-based approach.
Key Details
- Key schemes under FTP 2023: RoDTEP (Remission of Duties and Taxes on Exported Products), Advance Authorisation, Export Promotion Capital Goods (EPCG), SEZ/EHTP/STPI coverage
- RoDTEP replaced the earlier MEIS (Merchandise Exports from India Scheme) — WTO members had challenged MEIS as a prohibited export subsidy; RoDTEP is structured to be WTO-compliant
- Town of Export Excellence (TEE) scheme and Districts as Export Hubs (DEH): Policy to promote cluster-based and district-level export growth
- DGFT (Directorate General of Foreign Trade): Administers the FTP under the Ministry of Commerce and Industry
- Emphasis on e-commerce exports, MSME exporters, and emerging sectors including handicrafts, toys, and organic products
The 6.15% growth in cumulative exports against the backdrop of global trade slowdown and geopolitical uncertainties demonstrates the partial success of the FTP 2023 and export promotion architecture — a key data point for Mains essay or GS3 answers on trade policy.
- April–January 2025-26 total exports (merchandise + services): $720.76 billion (+6.15%)
- Previous year (April–January 2024-25): $679.02 billion
- Merchandise exports (Apr-Jan FY26): $366.63 billion
- Merchandise imports (Apr-Jan FY26): $649.86 billion
- Merchandise trade deficit (Apr-Jan FY26): $283.23 billion (wider than $247.38 billion in Apr-Jan FY25)
- Services trade surplus (Apr-Jan FY26): $180.58 billion (up from $153.56 billion)
- Total cumulative imports (Apr-Jan FY26): $823.41 billion (+6.54%)
- India's export target (FTP 2023): $2 trillion by 2030
- DGFT: Administers Foreign Trade Policy
- RoDTEP: WTO-compliant export duty remission scheme (replaced MEIS)