QuantEco Research | Nov-25 Merchandise trade - Deficit narrows sharply
Download ReportQuantEco Research | Nov-25 Merchandise trade - Deficit narrows sharply
The sharp drop in trade deficit in Nov-25 was driven by a sequential fall in imports (led by precious metals) while exports registered an expansion. While the import of precious metals appears to be normalizing after the Diwali-led spike, exports seem to be depicting remarkable resilience despite the three months of tariff impact. There are two notable developments in recent data: (i) the emergence of Spain, China, and Vietnam as key countries for India’s export diversification, and (ii) the share of US in India’s imports has exceeded that of Russia – this could act as a precursor to the much-anticipated India-US trade deal. With this as a backdrop and multiple factors still at play, we maintain our call for India’s FY26 current account deficit to be 1.3% of GDP (up from 0.6% in FY25)