India's September goods exports rise 23% as imports hit six-month low, narrowing trade deficit

New Delhi: India's September goods exports swelled 23% to $44.4 billion from the year ago, driven by electronic goods, petroleum products, engineering goods and, yarn and fabrics, as import growth slumped to an six-month low of 8% amid a sharp contraction in gold shipments to the country, helping the trade deficit narrow to $30.21 billion from $33 billion, according to official data released Thursday. The trade deficit was higher than $26.86 billion in August.

September imports were at $74.61 billion, with that of gold falling 81.27% on-year.

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Silver imports were down 49.11% from the year before.

Commerce secretary Rajesh Agarwal said exports have been maintaining their growth trend, having accelerated in the second quarter of the current fiscal year. Overall, exports grew 15.84% in the July-September period, compared with 11.84% in the first quarter.

"If the trend of last year continues, where merchandise exports in the second half of the year were much higher than the first half, then we are looking at full-year exports to be much higher than $500 billion," he said, adding that electronics and petrol imports are rising every month due to high consumption.

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India's goods exports stood at $441.8 billion in FY26 and $437.42 billion in FY25. "September's strong export growth is an encouraging affirmation of India's competitiveness in a challenging global trading environment," said Federation of Indian Export Organisations president SC Ralhan, underscoring the resilience of local exporters amid tariff uncertainties, geopolitical tensions and logistics challenges. "Sustaining this balance, while expanding our market reach, will be crucial in the second half of the financial year."

First-half exports rose 18.51% to $259.89 billion while imports climbed 16.31% to $437.53 billion from the year ago. The US, UAE, China, Singapore, the UK and Germany were among top export destinations in the first six months of the fiscal year. China, Russia, the US, UAE and South Korea were the key import sources.

Outbound shipments of engineering goods rose 21%, while those of electronics went up 70.5% and petroleum products advanced 72% in September.

"This high double-digit growth shows that the country's engineering sector can withstand external shocks," said EEPC India chairman Pankaj Chadha. "Trade has generally faced back-to-back disruptions and challenges over the past few years, starting with the Russia-Ukraine conflict. War in West Asia added to the uncertainty." India's exports to the Gulf amounted to a near-normal $5.56 billion in September, marginally lower than the $5.94 billion recorded in the same month last year, according to the data.

Bilateral trade with China rose about 29% to $91.76 billion in the first half, making the country India's largest trading partner in the period. Exports to China rose 36% to $11.41 billion and imports gained 27.82% to $80.34 billion. Agrawal noted that services trade growth is likely to slow globally to 3.3% in 2026 from 4% projected earlier by the WTO due to the conflict in West Asia. The war has hit travel and tourism-related services exports and overall export growth would have been higher without this impact, he said.

Trade Agreements

The India-New Zealand FTA will come into force on October 20. In April-September, exports to the UK rose 11.8% to $7.32 billion. The trade pact between the two sides came into effect in July.

The next round of negotiations on the proposed free trade agreement (FTA) with Canada will be held in early November in India, officials said. Chief negotiators from the two countries concluded the fifth round of talks on October 9 in Canada. The terms of reference for a preferential trade agreement with Mexico are expected to be signed this month. India and the Maldives had their first round of FTA talks in early July , the second round has been ongoing since September 20.