India’s trade deficit narrows to $26.86 billion in August

The country’s merchandise exports surged 26.12 per cent to $43.81 billion in August, driven by a jump in petroleum product shipments, while a dip in gold imports helped narrow the trade deficit to a five-month low of $26.86 billion.

Imports rose by 14.1 per cent year-on-year to $70.76 billion in August.

Brent crude oil prices ranged between $90 and $94 per barrel during the last month.

The growth in exports in August was the highest since June 2022, when shipments had risen 30.12 per cent.

During April-August this fiscal, exports jumped 17.85 per cent year-on-year to $215.91 billion, and imports climbed 18.21 per cent to $363 billion. The merchandise trade deficit during the first five months of this fiscal widened to $147.09 billion as compared to $123.88 billion during April-August 2025-26. In August 2025, the deficit was $27.22 billion. In July, it was $31.98 billion. The last low was $20.67 billion in March.

India’s gold imports dipped to $2.3 billion in August from $5.4 billion in August 2025, registering a decline of 57.7 per cent.

Briefing the media on the data, Commerce Secretary Rajesh Agarwal said the good momentum of export growth is continuing and is rather building up also.

He said higher imports during the first five months of 2026-27 are being propelled by strong domestic economic expansion, rising energy requirements and the critical inputs needed to sustain the rapid growth of manufacturing sector. It has pushed the trade deficit also.

The major drivers of trade deficit have been energy items like petroleum, crude and coal, coke and briquettes, and electronic goods.

On the exports front, he said a mix of commodities helped push the growth and that included engineering goods, petroleum products, chemicals and textiles.

“At the same time, major demand has come from the US, EU, BRICS nations and emerging economies. So this also underscores India’s expanding global footprint and improves our resilience, diversification and strategic trade integration objectives,” he said.

India’s exports to BRICS countries rose by 13.3 per cent to $34.5 billion in the first five months of 2026-27.

The exports have recorded healthy growth rate not only in value terms, but in volume terms as well, Agarwal said.

During April-August 2026-27, crude oil imports rose to $95.57 billion from $78.07 billion in the same period last year. Electronic goods’ imports too have increased to $66.48 billion from $46.31 billion during April-August 2025-26.

On export front, petroleum products’ shipment have increased to $35.31 billion during April-August 2026-27 from $25.32 billion in the same period last year.