India’s merchandise trade deficit narrowed to $20.67 billion in March as imports eased from the previous year, though elevated purchases of energy, gold and electronics continued to weigh on the overall trade balance at the close of FY26.
The West Asia war has kept freight costs elevated and injected fresh uncertainty into global trade flows.
The gap between merchandise imports and exports was less than $21.69 billion in March 2025, according to provisional estimates released by the ministry of commerce and industry on Wednesday.
Merchandise exports in March were estimated at $38.92 billion, down from $42.05 billion in the same month a year ago. Imports declined more sharply to $59.59 billion from $63.74 billion a year earlier, helping narrow the monthly deficit.
Including services, India’s overall trade deficit (merchandise plus services) eased to $2.44 billion in March 2026 from $3.55 billion in March 2025. Overall exports stood at $74.11 billion, compared with $77.67 billion a year ago, while imports fell to $76.55 billion from $81.22 billion.
Services exports were estimated at $35.20 billion in March, marginally lower than $35.63 billion a year earlier. Services imports declined to $16.96 billion from $17.48 billion, helping cushion the merchandise trade gap.
For the full financial year 2025-26, India’s merchandise exports rose to $441.78 billion from $437.70 billion in the previous year, while imports increased to $774.98 billion from $721.20 billion, taking the annual merchandise trade deficit to $333.204 billion.