India’s Total Trade Hits $1.73 Trillion
On October 6, 2025, NITI Aayog released the fourth edition of its flagship Trade Watch Quarterly report, offering a comprehensive analysis of India’s trade performance for Q4 of FY 2024–25 (January to March). The report highlights India’s resilience in global trade, with total trade reaching $1.73 trillion, driven by record services exports and strategic shifts in merchandise trade.
Key Trade Figures
- Total Trade: $1.73 trillion
- Exports: $823 billion
- Imports: $908 billion
- Services Exports: $387.5 billion (record high)
- Merchandise Exports: $374.1 billion
While merchandise exports saw a modest contraction, services exports surged, offsetting trade deficits and reinforcing India’s strength in knowledge-based sectors.
Sectoral Performance
India’s export growth was led by:
- Electrical Machinery: +38.2% YoY
- Pharmaceuticals: Strong growth in generics and APIs
- Cereals: Boosted by global food security concerns
However, exports of mineral fuels and organic chemicals declined, contributing to the overall contraction in merchandise trade.
Import Trends
Imports rose marginally, driven by:
- Nuclear Reactors: +18.1%
- Inorganic Chemicals: +82.1%
- Electronics: Surge in demand from China
The UAE overtook Russia as India’s second-largest supplier, largely due to gold inflows under CEPA agreements.
Regional Trade Shifts
- North America: Emerged as top export market (+25% YoY)
- EU, GCC, ASEAN: Moderate growth
- China: Strong import growth in electronics and machinery
India’s exports to the USA grew by 27%, while exports to the UK, Netherlands, and Singapore dipped slightly.
Footwear and Leather Sector Insights
The report dedicates a section to India’s leather and footwear exports4.4 million people, nearly half of them women. Key insights include:
- India’s global market share: 1.8% of $296 billion
- Strength in processed leather and niche apparel
- Challenges in non-leather and sustainable footwear demand
States like Tamil Nadu lead in production and exports, but India’s overall share remains stagnant due to limited diversification.
India’s trade strategy must now evolve beyond traditional export models. With global demand shifting toward sustainability, circular economy practices, and digital integration, Indian exporters need to invest in product innovation, compliance readiness, and branding. The government’s Production Linked Incentive (PLI) schemes offer a foundation, but MSMEs require targeted support to scale and compete globally. NITI Aayog recommends building sector-specific export clusters, enhancing logistics infrastructure, and leveraging FTAs to unlock new markets. As geopolitical risks rise, India’s trade resilience will depend on its ability to adapt quickly, diversify intelligently, and align with emerging global standards in trade governance.
Strategic Recommendations
NITI Aayog CEO BVR Subrahmanyam emphasized the need to:
- Diversify export base beyond traditional sectors
- Strengthen MSMEs and invest in R&D
- Align with green and design-driven global value chains
- Adapt to shifting demand patterns and geopolitical risks
He noted that India missed opportunities in sectors like non-leather footwear and aerospace, urging faster policy adaptation.
Trade Watch Highlights
- World Trade Policy Uncertainty Index doubled to 478
- India’s trade deficit moderated due to strong services exports
- Emerging sectors like aerospace and high-value manufacturing show promise
Conclusion: Building Resilience in Global Trade
The Q4 FY25 Trade Watch underscores India’s evolving trade landscape. With services exports at historic highs and merchandise trade facing sectoral shifts, the path forward lies in strategic diversification, innovation, and regional partnerships. As global demand pivots toward sustainability and digital integration, India must leverage its strengths and adapt swiftly to maintain its competitive edge.
