Bibhudatta Pradhan / NEW DELHI
India’s merchandise trade deficit widened sharply to $21.54 billion in March, driven by a surge in imports as the country navigates escalating U.S. tariff policies under President Donald Trump.
The gap between exports and imports rose from a three-year low of $14.05 billion in February, according to data from the Commerce Ministry. Exports rose to $41.97 billion in March, up from $36.91 billion the previous month, while imports climbed more steeply to $63.51 billion from $50.96 billion in February.
For the full financial year ending March 2025, merchandise exports stood at $437.42 billion, slightly higher than $437.07 billion in FY24. The country’s overall exports of goods and services increased by 5.5% to $820.93 billion. Merchandise imports rose to $720.24 billion in FY25 from $678.21 billion in FY24.
President Trump has granted India a 90-day suspension on certain U.S. tariffs until July 9, but several duties previously announced remain in effect. A general 10% tariff on all imported goods has been in force since April 5.
The US imposed an additional import duty of 26% on Indian goods. The tariffs on India’s competitors- including Thailand, Vietnam and China – were even higher.
Meanwhile, Trump’s trade war has intensified, with tariffs on Chinese goods reaching up to 145%, prompting China to retaliate with 125% duties on U.S. products.
Amid the rising trade tensions, India is pushing for a bilateral trade agreement with the U.S. to soften the blow of reciprocal tariffs. Officials from both nations are working toward concluding the first phase of the deal by fall 2025, in hopes of stabilizing trade ties in an increasingly protectionist global environment.