New Delhi: India’s merchandise trade deficit widened sharply to $30.43 billion in June 2026, surpassing economists’ expectations and highlighting persistent challenges in balancing the country’s external trade. The latest figures, released by the government, show that the trade gap increased from $28.21 billion in May, while significantly exceeding the $26.63 billion deficit projected in a Reuters poll of economists.
The wider trade deficit came even as both exports and imports declined during the month. Merchandise exports fell to $40.41 billion in June, down from $45.2 billion in May, indicating a slowdown in overseas demand for Indian goods. Imports also moderated, dropping to $70.84 billion from $73.41 billion in the previous month. However, the sharper fall in exports compared with imports resulted in a larger trade imbalance.
According to the report, the Indian government remains confident in its trade outlook, supported by expanding commercial ties with new international partners and recent domestic political gains under Prime Minister Narendra Modi’s leadership. Officials are expected to continue efforts to diversify export markets and enhance trade competitiveness to reduce the widening merchandise trade gap.
In addition to merchandise trade, the Ministry of Commerce estimated that services exports stood at $33.03 billion in June, while services imports were estimated at $17.92 billion. The difference suggests that India maintained a healthy surplus in services trade, reflecting the continued strength of sectors such as information technology, business services, and financial services.
A strong services surplus has historically helped offset part of India’s merchandise trade deficit, contributing to greater stability in the country’s overall external sector. However, economists note that sustained growth in merchandise exports remains essential to maintaining a healthy balance of payments and supporting long-term economic growth.
The June trade figures will be closely watched by policymakers and investors as they assess the impact of global demand, commodity prices, and ongoing international trade negotiations on India’s economic outlook in the coming months.
