Merchandise imports outpace exports

Amid the ongoing tariff-related disruptions, India’s merchandise exports seem to be doing well so far, partly reflecting the frontloading of some demand from the US. US reciprocal tariffs that came into the picture in April this year (albeit to be paused for a 90-day period later in the month) failed to cast a shadow on India’s merchandise exports, which rose 9% onyear to $38.5 billion in April 2025, significantly better than the 0.7% growth in March 2025 and the contractionary spell in the past four consecutive months.

Exports rose across the board with oil exports up 4.8% on-year, gems and jewellery 10.6% and core exports 10.0%.

Oil exports returned to the growth territory after 10 months despite the sharp fall in crude oil prices in April (Brent was at $67.8/bbl, down from $72.6/bbl in March and $90.1/bbl in April last year) and the 21-day shutdown of parts of Reliance’s Jamnagar refinery (India’s largest oil refinery) for maintenance.

According to the Commerce Ministry, India’s exports to the US (the country’s key export destination) reached $8.4 billion in April, a rise of 27.3% on-year, while that of UAE (the second-largest export destination) reached $3.5 billion, representing a rise of 33.7% on-year (albeit on a low base).

Imports, too, surged, outpacing the rise in exports - at $64.9, India’s merchandise imports recorded a 19.1% rise on-year, a 32-month high. However, this could be a worrisome situation, especially with regards to the enhanced dumping fears, following the heighted US-China tariff dispute. India’s imports from China stood at $9.9 billion in April, up 27.1% on-year.

The surge in imports was led by oil imports, which rose 25.5% on-year in April, followed by a 18.1% rise in core imports and a nominal 4.2% rise in gems and jewellery imports. The rise in oil import bill seems to reflect the increased crude oil purchase as the prices softened substantially during the month.

India’s services exports continue to grow at a healthy clip. At $35.6 billion, they were up 18.6% on-year in March, and according to the preliminary estimate, they were up at $35.3 billion in April, a rise of 17% on-year. That said, this space will remain watchful, given the forecast of slowdown in the US, one of India’s biggest services exports markets.