India Exports Rise 13% in January, Even as Trade Deficit Widens

India’s overall exports climbed 13.16 per cent year-on-year to USD 80.45 billion in January 2026, up from USD 71.09 billion in January 2025, according to data released by the Commerce Ministry on Monday. However, faster growth in imports pushed the trade deficit sharply higher during the month. Combined imports of merchandise and services rose 18.77 per cent to USD 90.83 billion, widening the overall trade deficit to USD 10.38 billion, almost double the USD 5.39 billion recorded a year ago.

What Drove January’s Export and Import Growth?

Both the merchandise and services segments registered growth in January. Merchandise exports inched up marginally from USD 36.34 billion in January 2025 to USD 36.56 billion in January 2026. The sharper expansion came from the services sector, where exports rose significantly from USD 34.75 billion to USD 43.90 billion during the same period.

On the import side, the surge outpaced export growth. Overall imports, combining goods and services, climbed to USD 90.83 billion compared with USD 76.48 billion in January last year. The widening gap between export earnings and import expenditure led to a trade deficit of USD 10.38 billion for the month, reflecting mounting external sector pressures despite healthy export expansion.

April–January Trade Performance: How Is FY26 Shaping Up?

For the first 10 months of the current financial year (April-January 2025-26), cumulative exports, merchandise and services combined, stood at an estimated USD 720.76 billion. This marks a 6.15 per cent increase over USD 679 billion recorded in the corresponding period of the previous fiscal, translating into an incremental rise of roughly USD 40 billion.

Commerce Secretary Rajesh Agrawal said the government expects total exports for the full financial year to cross USD 860 billion. “In services, we expect to cross USD 410 billion this year (2025-2026),” Agrawal stated, outlining projections for the ongoing fiscal.

India had previously achieved a record USD 824.9 billion in total exports in 2024-25, reflecting annual growth of 6.01 per cent over USD 778.1 billion in 2023-24. That performance had surpassed the initial target of USD 800 billion, setting a new high watermark for the country’s external trade.

Imports Continue To Outpace Exports

While exports have maintained moderate growth in FY26 so far, imports have also risen steadily. During April-January 2025-26, total imports increased 6.54 per cent year-on-year to USD 823.41 billion, compared with USD 772.85 billion in the same period of 2024-25.

Breaking this down, merchandise imports reached USD 649.86 billion, marking a 7.21 per cent rise from USD 606.13 billion recorded a year earlier. Services imports grew at a comparatively slower pace of 4.10 per cent, increasing to USD 173.55 billion from USD 166.72 billion in the corresponding period.

The faster expansion in goods imports relative to services imports has contributed to the widening trade imbalance, particularly in months where merchandise exports have shown only marginal gains.

What Numbers Indicate

January’s data underscores two parallel trends: sustained strength in services exports and persistent pressure from rising imports. While the double-digit growth in overall exports signals resilience in external demand, particularly in services, the near-doubling of the trade deficit reflects the impact of stronger import growth.

With cumulative exports already exceeding USD 720 billion in the first 10 months, the government remains optimistic about breaching the USD 860 billion mark in FY26. However, the trajectory of imports will remain central to how India’s overall trade balance shapes up in the coming months.