India’s trade deficit widens to $25.04 billion in December

India’s trade deficit widened to $25.04 billion in December, driven by rise in imports and subdued export growth amid persistent geopolitical challenges and trade restrictions, even as negotiations on an India–US trade deal continue to make progress.According to data released by the Ministry of Commerce and Industry on Thursday, merchandise exports rose 1.87 per cent year-on-year to $38.51 billion in December, compared with $37.80 billion in the same month last year. Imports, however, increased at a faster pace of 8.7 per cent to $63.55 billion, up from $58.43 billion a year earlier.The trade deficit widened from $20.63 billion in December 2024 and compared with $24.53 billion recorded in November 2025.
Commerce Secretary Rajesh Agrawal said exports remained in positive territory despite global uncertainties affecting trade flows. On the proposed India–US bilateral trade agreement, Agrawal stated that both countries are continuously engaged in negotiations and are close to concluding a deal that could lower tariffs. “There are pending issues being talked about. It’s very near, but we can’t put a deadline. The deal will happen when both sides are ready, and we are ready to announce,” he said.Agrawal also informed that Commerce and Industry Minister Piyush Goyal and US Trade Representative Jamieson Greer held a virtual meeting last month to discuss the proposed agreement, underlining sustained engagement between the two sides.Highlighting trade ties with the US, the Commerce Secretary noted that India’s monthly exports to the US have averaged around $7 billion despite relatively high tariffs. Exports to the US during the first nine months of the current fiscal rose 9.75 per cent compared with the corresponding period last year.
During the April–December period, the US, the UAE and China emerged as India’s top three export destinations. Exports to China surged 36.68 per cent year-on-year during this period.Cumulatively, India’s merchandise exports increased 2.44 per cent to $330.29 billion in the first nine months of 2025–26, while imports climbed 5.9 per cent to $578.61 billion. This resulted in a trade deficit of $248.32 billion during April–December.India’s total exports, including merchandise and services, declined 1.01 per cent to $74.01 billion in December, while total imports rose 6.17 per cent to $80.94 billion.Based on current trends, Agrawal said India’s overall exports are likely to cross $850 billion in the current fiscal.
Federation of Indian Export Organisations (FIEO) President SC Ralhan said India’s export performance so far in the current fiscal has been encouraging, given the volatility in global trade flows. He added that India’s top export destinations — the US, the UAE, China, the Netherlands, the UK, Germany, Bangladesh, Singapore, Saudi Arabia and Hong Kong — reflect a well-diversified and resilient export footprint.“This diversification is particularly critical at a time when global trade routes are being reshaped due to geopolitical conflicts, sanctions, shipping disruptions and strategic realignments,” Ralhan said.

(Business Correspondent)