New Delhi: The official trade data for December 2025 has been released by the Ministry of Commerce and Industry. The numbers show a mixed picture for the Indian economy. While exports have shown resilience by growing slightly despite global challenges, imports have surged at a faster pace, leading to a wider trade deficit.
Here is a simple breakdown of what the new data says, which sectors are winning, and what this means for India’s economy in 2026.
Key Highlights of December 2025 Trade Data
On January 15, the government released the trade statistics for the month of December 2025.
- Merchandise Exports: India’s goods exports rose by 1.87% to $38.5 billion, compared to $37.8 billion in December 2024.
- Merchandise Imports: Imports grew much faster, rising by 8.7% to $63.55 billion.
- Trade Deficit: The gap between exports and imports (trade deficit) has widened to $25.04 billion. This is higher than the $22 billion deficit recorded in the same month last year.
Which Sectors are Growing?
Despite fears of a global slowdown and tariff wars (like potential US tariffs), Indian products are finding buyers abroad.
Top Performing Sectors (Winners)
- Electronics: This is the star performer. Electronic goods exports jumped by nearly 17% to reach $4.17 billion. This growth is largely driven by smartphone manufacturing (like Apple iPhones) under the PLI (Production Linked Incentive) scheme.
- Drugs & Pharmaceuticals: Indian medicines continue to be in high demand globally, recording a growth of over 5%.
- Engineering Goods: This sector also saw positive growth, showing that Indian machinery and metal products are competitive.
- Marine Products: Exports of seafood and other marine items rose by over 11%.
Why Did Imports Increase?
The sharp rise in imports is the main reason for the wider deficit. The key items India bought more of included:
- Gold & Silver: There was a significant jump in the import of precious metals.
- Crude Oil: As usual, energy needs drove up the import bill.
- Project Goods: Machinery and industrial items needed for infrastructure projects in India also contributed to higher imports.
Services Trade: The Strong Pillar
While the goods trade has a deficit, India continues to be a superpower in services (like IT, software, and consulting).
- Services Exports: Estimated at $35.50 billion for December 2025.
- Services Imports: Estimated at $17.38 billion.
- Net Surplus: India earned a massive surplus of roughly $18 billion from services, which helps balance out the loss from goods trade.
Official Government Statement
Commerce Secretary Rajesh Agrawal addressed the media regarding the data. He expressed confidence that despite global geopolitical tensions and shipping disruptions (like the Red Sea crisis), India is on a strong path.
“Going by the trend, we expect that total exports (goods and services combined) are likely to cross $850 billion this fiscal year,” the Secretary stated.
What Happens Next? (The EU FTA Angle)
Looking ahead, all eyes are on the upcoming Republic Day (January 26, 2026). Leaders from the European Union (EU) are visiting India, and reports suggest a major Free Trade Agreement (FTA) could be announced around January 27.
This deal is crucial because it addresses “Data Trade” and “Data Security” issues, which have been hurdles in the past. If signed, this pact could significantly boost Indian exports of textiles and leather to Europe.
Frequently Asked Questions (FAQs)
Q1: What is a Trade Deficit?
A trade deficit happens when a country buys (imports) more goods from other countries than it sells (exports). In December 2025, India imported $25 billion more than it exported.
Q2: Is a high trade deficit bad for India?
Not necessarily. If the imports are for things like machinery or raw materials (Gold, Oil) that help industries grow, it can be okay. However, a very high deficit puts pressure on the Indian Rupee.
Q3: Which product does India export the most recently?
Engineering goods and Petroleum products are traditional leaders, but Electronics (Smartphones) are currently seeing the fastest growth due to the “Make in India” push.
Q4: When is the India-EU Trade Deal expected?
The negotiations are in the final stages. A formal announcement is expected during the EU leaders’ visit to New Delhi for Republic Day, around January 27, 2026.
Q5: Where can I check the official data?
You can check the detailed statistics on the official website of the Ministry of Commerce and Industry (commerce.gov.in).