India’s merchandise exports contracted by 11.8 per cent year-on-year to $34.38 billion in October, marking the second consecutive month of decline following the United States’ decision on August 27 to impose a 50 per cent tariff hike on several Indian products, Crisil said in its latest report. The rating agency noted that the fall in exports was broad-based, impacting petroleum products, gems and jewellery, and major core sectors. Petroleum exports slipped 10.4 per cent in October, reversing the strong 15.1 per cent growth seen in September, while core exports fell 10.2 per cent after registering 6.1 per cent growth in the previous month.
Exports to the US, India’s largest market, dropped 8.6 per cent year-on-year to $6.3 billion in October. Though still negative, this was a recovery from the 11.9 per cent decline recorded in September. Crisil observed that the US announcement on November 16 to reduce tariffs on 254 food items could benefit Indian agricultural exporters, particularly in categories such as tea and spices. However, exports to non-US markets weakened sharply, falling 12.5 per cent year-on-year in October compared to the 10.9 per cent growth seen in September, highlighting the broader slowdown in global demand.
Despite the pressure on goods exports, the report said India’s current account deficit is expected to stay within manageable levels, supported by strong services trade, steady remittances and lower global crude prices. Merchandise imports remained stable at $76.06 billion in October 2025, helping contain a steeper deterioration in the trade balance.