India's exports grow fastest in nearly 3.5 years; gold imports shrank

Shipments to US, China rose sharply in November

India’s merchandise exports rose 19.4 per cent year-on-year (Y-o-Y) to $38.1 billion in November, the fastest pace of growth in 41 months, driven by a sharp increase in shipments to the US, which rose 22.6 per cent, and China, which surged 90.1 per cent, according to data released by the commerce department.

 

Strong exports helped narrow the trade deficit to a five-month low of $24.53 billion in November, as imports contracted 1.9 per cent to $62.7 billion, led by a sharp decline in gold imports. The deficit narrowed from a record $41.68 billion in October this year and from $31.93 billion in November last year. Cumulative exports, including merchandise and services, rose 15.5 per cent to $64.05 billion, while cumulative imports fell 0.6 per cent to $80.6 billion, resulting in an overall trade deficit of $6.6 billion. 

 

Services exports grew 11.67 per cent to $35.86 billion in November, while services imports increased 4.11 per cent to $17.96 billion, yielding a surplus of $17.9 billion. Services trade data for November, however, is an “estimate” and will be revised following a subsequent release by the Reserve Bank of India. 

 

Commerce Secretary Rajesh Agrawal said India had “held the fort” in exports to the US despite the imposition of a 50 per cent tariff, which is 30 percentage points higher than that faced by several competing nations, particularly in labour-intensive sectors. “It is good that many exporters have been able to hold on to their supply chains. There is a fair expectation on each side that both countries will be able to finalise a deal sooner or later. Let’s try to see how it goes in the next few months,” Agrawal told reporters at a briefing on Monday.

 

In November, gold imports declined 59.15 per cent Y-o-Y to $4.02 billion, while petroleum imports contracted 11.27 per cent to $14.11 billion, reflecting lower oil prices. Vegetable oil imports fell by nearly a fifth to $1.5 billion, while inbound shipments of coal, coke and briquettes also declined 5.7 per cent to $2.25 billion during the month.

 

Non-petroleum and non-gems and jewellery exports, a key indicator of underlying export health, rose by nearly a fifth to $31.56 billion in November. Among major sectors, gems and jewellery exports increased 27.8 per cent, engineering goods rose 23.76 per cent, drugs and pharmaceuticals climbed 20.91 per cent, organic and inorganic chemicals grew 18.49 per cent, and petroleum exports rose 11.65 per cent. Readymade garments exports increased 11.27 per cent during the month under review.

 

Aditi Nayar, chief economist at ICRA, said that with the normalisation of supply chains after the holiday period and a pickup in demand following the festival season, merchandise exports rose while imports declined sharply, compressing the trade deficit to a five-month low.

 

“With the fall in gold imports in November 2025, year-to-date imports in FY26 ($45.3 billion) are only slightly higher than in FY25 ($43.8 billion), despite the sharp rise in prices. With the increase in the average merchandise trade deficit in October-November, we estimate the current account deficit to widen to $20-24 billion in the third quarter of FY26 from $11-12 billion in both Q3FY25 and Q2FY26,” Nayar said.

 

S C Ralhan, president of the Federation of Indian Export Organisations, said diversification of export markets, along with the continued resilience of several key sectors, had played a crucial role in supporting export growth.

 

During April-November 2025, the US remained India’s top export destination despite the imposition of a high tariff of 50 per cent, clearly demonstrating the resilience and adaptability of India’s exporting community, Ralhan added.