The doubling of US tariffs on Indian goods to 50 percent in August 2025 initially sent shockwaves across key export-driven sectors, including engineering goods, electronics, and gems and jewellery. However, India’s economy demonstrated remarkable resilience, recovering strongly within two months of the measures coming into effect.
Official data shows that India’s trade deficit narrowed significantly to $24.53 billion in November, down from $31.93 billion in the same month last year and a sharp improvement over October’s $41.68 billion. The turnaround was driven by a strong rebound in exports and a moderation in imports.
India’s exports rose 19.37 percent in November to $38.13 billion, while imports declined 1.88 percent to $62.66 billion. Commerce Secretary Rajesh Agrawal noted that the robust export performance in November more than offset losses recorded in September and October following the tariff hike.
Services exports also remained resilient, particularly to the United States. Shipments of services to the US increased by $1.3 billion year-on-year to $6.98 billion, indicating that American demand for Indian offerings remained steady despite higher tariffs. Even under the 50 percent levy, bilateral trade flows showed underlying strength.
During the April–November period, India’s merchandise exports reached $292.07 billion, while imports stood at $515.21 billion. Exports to the United States climbed to $59.04 billion, up from $53.01 billion in the corresponding period last year.
Trade with other key partners also improved. Exports to the United Arab Emirates rose to $25.49 billion, while imports from the UAE stood at $40.81 billion. Imports from China increased to $84.27 billion, whereas imports from Russia declined to $40.81 billion.
Government initiatives—including tax rationalisation, export incentives, and labour reforms—played a critical role in cushioning the economy from external pressures such as the US tariff hike. By recalibrating trade strategies and strengthening domestic policy support, India managed to sustain export momentum, reduce its trade deficit, and reinforce economic resilience amid global trade disruptions.
