India’s Trade Deficit Widens to $32.15 Billion in September; Gold Imports Surge

India’s trade deficit widened to a 13-month high in September, driven by a sharp rise in bullion imports, even as merchandise exports posted moderate growth. Data released by the commerce department highlights the impact of higher tariffs and festive season demand on trade flows.

Merchandise Trade Performance

• Exports: $36.38 billion, up 6.7% YoY
• Imports: $68.53 billion, up 16.7% YoY
• Trade Deficit: $32.15 billion vs $24.65 billion in September 2024

Shipments to the U.S. fell nearly 12% YoY to $5.43 billion, reflecting the full impact of the 50% tariff that came into effect in September.

Services Trade

• Services Exports: $30.82 billion, down 5.5% YoY
• Services Imports: $15.3 billion, down 7.6% YoY
• Services Surplus: $15.5 billion

The commerce department clarified that services trade data for September is provisional and subject to revision based on RBI updates.

Drivers of Import Surge

Inbound shipments surged due to:

• Gold Imports: Up 107% YoY to $9.6 billion
• Silver Imports: Up 139% YoY to $1.3 billion
• Fertiliser Imports: Up 202% YoY to $2.36 billion
• Electronics Imports: Up 15% YoY to $9.82 billion

The Commerce Secretary noted that cumulative gold imports for April–September were 8.7% lower YoY, suggesting the September spike was likely seasonal.

Impact of U.S. Tariffs

The government estimates that 55% of India’s merchandise exports to the U.S. will be affected by the additional tariff. Sectors such as shrimp, textiles, and gems & jewellery are expected to bear the brunt of the impact.

Read More: India's Economy Projected to Grow at 6.7% Annually.

Conclusion

India’s September trade data reflects a sharp rise in imports, led by bullion and fertilisers, alongside moderate export growth. While festive demand contributed to the surge in gold imports, U.S. tariffs weighed on outbound shipments. The government continues to assess sectoral impacts as it targets balanced trade growth for FY26.

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