India’s merchandise trade deficit moderated to a 4 month low of USD 18.8 bn in Jun-25 from USD 21.9 bn in May-25
Download ReportQuantEco Research | Jun-25 Merchandise Trade - Deficit moderates despite uncertainty
India’s merchandise trade deficit moderated to a 4 month low of USD 18.8 bn in Jun-25 from USD 21.9 bn in May-25. This was driven by a faster sequential decline in imports vis-à-vis exports. From a granular perspective, narrowing of the deficit on account of Chemicals, Gems and jewellery, and Machinery items helped in the overall moderation in headline trade deficit. The world economy has witnessed a little over three months of the US triggered tariff frenzy. Although clarity on US tariffs continues to deceive, recent developments highlight the importance of patiently moving on the path of trade negotiations. We continue to maintain that global geopolitics and geoeconomics will be a key determinant of India’s external trade in FY26 and beyond via shifts in trade patterns and price of traded commodities. Amidst the looming and lingering uncertainty, we retain our FY26 current account deficit forecast of 0.8% of GDP (USD 33 bn) for now.