India merchandise exports surge 18% to $45.2 billion in May 2025
Synopsis
India's exports hit $45.2 billion in May — an 18% year-on-year jump that Commerce Secretary Rajesh Agrawal called one of the highest monthly growth prints on record. But a widening trade deficit, oil above $100 a barrel, and an unresolved West Asia crisis mean the headline number carries real asterisks.
Key Takeaways
India's merchandise exports rose 18 per cent year-on-year to $45.2 billion in May 2025 .
Cumulative April–May FY 2026-27 exports reached $88.91 billion , up 16.09 per cent over the same period last year.
Imports surged 20.62 per cent to $73.41 billion , pushing the trade deficit to $28.21 billion .
The year-on-year trade deficit widened 25 per cent from $22.56 billion in May 2024, driven by oil prices crossing $100 per barrel .
West Asia exports largely recovered, with UAE , Saudi Arabia , Jordan , and Yemen shipments back near May 2024 levels.
India has operationalised FTAs with the UAE , Australia , and EFTA ; state-level workshops planned in 'mission mode' to boost FTA utilisation.
India's merchandise exports rose a sharp 18 per cent year-on-year to $45.2 billion in May 2025, according to data released by the commerce ministry on Monday, 15 June. The growth came despite persistent uncertainties in global markets, and Commerce Secretary Rajesh Agrawal described it as 'one of the highest monthly export growth prints' in recent memory.
Two-Month Momentum Builds
The May figure follows a similarly strong April, when merchandise exports reached $43.56 billion — up from $38.28 billion in April 2024. Cumulatively, merchandise exports for the April–May period of FY 2026-27 stood at $88.91 billion, reflecting 16.09 per cent growth over the corresponding two months of the previous financial year. 'If we carry on this momentum, FY27 will be a good year for trade,' Agrawal told reporters.
Import Surge Widens Trade Deficit
Imports climbed 20.62 per cent to $73.41 billion in May, leaving a trade deficit of $28.21 billion — broadly flat compared with $28.38 billion in April. On a year-on-year basis, however, the trade deficit widened by 25 per cent from $22.56 billion in May 2024, driven largely by a surge in oil prices that reportedly crossed $100 per barrel amid the ongoing West Asia crisis.
West Asia Exports Recover
Agrawal noted that exports to the Middle East, which had been disrupted earlier, largely recovered in May, with shipments to UAE, Saudi Arabia, Jordan, and Yemen helping the region 'more or less achieve' the same export levels as May 2024. He added that 'many of our problems will be calibrated' if the recently announced US-Iran peace deal 'proves sustainable' — a caveat that underscores how geopolitical risk continues to shadow India's export outlook.
FTA Push and Long-Term Export Base
Agrawal pointed out that India's export base has nearly doubled over the past 12 years, with services export growth tripling over the same period. The government has operationalised trade agreements with the UAE, Australia, and the European Free Trade Association (EFTA), and expects further momentum as more free trade agreements (FTAs) come into force. 'We hope to continue the momentum in exports growth with a new vigour with all the FTAs coming in,' he said. The commerce department plans to run stakeholder workshops across states in 'mission mode' to help exporters tap the market access these agreements provide.
What to Watch
The durability of this export surge will depend on whether the West Asia situation stabilises, oil prices ease from the $100-per-barrel level, and FTA-linked trade flows materialise at scale. A sustained monthly run rate above $44 billion would be needed to meaningfully lift India's full-year trade performance for FY 2026-27.
Point of View
But the composition matters as much as the headline. The trade deficit widening 25 per cent year-on-year — driven by oil above $100 a barrel — signals that import compression, not export competitiveness alone, will determine FY27's current account arithmetic. The West Asia recovery is encouraging but fragile: it rests on a US-Iran peace deal that Commerce Secretary Agrawal himself qualified as needing to 'prove sustainable.' India's FTA strategy is the right structural bet, but the gap between signing agreements and exporters actually using them has historically been wide — which is precisely why the 'mission mode' workshop push is overdue, not optional.
NationPress
12 Aug 2026
Frequently Asked Questions
How much did India's merchandise exports grow in May 2025?
India's merchandise exports grew 18 per cent year-on-year to $45.2 billion in May 2025, according to commerce ministry data released on 15 June. Commerce Secretary Rajesh Agrawal described it as one of the highest monthly export growth prints in recent memory.
What is India's trade deficit for May 2025?
India's merchandise trade deficit stood at $28.21 billion in May 2025, broadly flat compared with $28.38 billion in April. However, on a year-on-year basis, the deficit widened 25 per cent from $22.56 billion in May 2024, largely due to oil prices surging above $100 per barrel amid the West Asia crisis.
What drove the surge in India's import bill in May 2025?
Imports rose 20.62 per cent to $73.41 billion in May 2025, with the primary driver being elevated crude oil prices that reportedly crossed $100 per barrel due to the ongoing West Asia crisis.
How have India's exports performed in the April–May FY27 period?
Cumulative merchandise exports for April–May of FY 2026-27 reached $88.91 billion , representing 16.09 per cent growth over the same two-month period of the previous financial year. This marks two consecutive months of high export growth.
How do India's free trade agreements affect export growth?
India has operationalised FTAs with the UAE , Australia , and the European Free Trade Association (EFTA) , which are expected to open new market access for exporters. The commerce department plans to run 'mission mode' workshops across states to help exporters and stakeholders understand and utilise the benefits available under these agreements.
