Strong rebound in exports, but import bill hits all-time high in October

India's exports surge in October, driven by strong demand from developed markets, with a focus on key sectors yielding results.

India’s goods exports, that had clocked an anaemic 1% uptick in the first half of 2024-25, began the second half on a strong note with October shipments jumping at a 28-month high pace of 17.25% to touch $39.2 billion, this year’s second best-tally.

However, this was accompanied by a 3.9% rise in the country’s merchandise import bill, lifting it to a fresh record high of $66.34 billion, eclipsing this August’s $64.34 billion import figure that was the highest at the time.

The merchandise trade deficit has thus widened from a five-month low of $20.8 billion in September to $27.14 billion in October, the second highest so far this financial year and the third highest ever.

Economists attributed the spike in the import bill primarily to higher gold and oil imports. Although the precious yellow metal’s imports dropped a marginal 1.4% from last October to $7.13 billion, this was 62% higher than September’s figure.

Petroleum imports, on the other hand, rose 13.3% year-on-year to $18.3 billion, and were 46.4% over the previous month’s $12.5 billion. This coincided with a continuous decline in petroleum exports, which slipped 22.1% in October to $4.58 billion, below September’s figure of $4.7 billion, which had marked a 32-month low.

Commerce Secretary Sunil Barthwal, however downplayed the import bill rise, and highlighted the trade trends beyond the petroleum basket. Between April and October, India’s non-petroleum exports have surged to the highest ever tally of $211.3 billion and if this trend continues, India’s total exports, including services, will cross the $800 billion mark this year to set a new record, he remarked.

“A key factor for the 17%-plus growth in exports could be improved demand for this Christmas from developed markets as firms start stocking up inventories for the festival. This demand seems far better than last year and gives us confidence that the coming months will also see a healthy uptick,” the top trade official said.