Tariff Tempest 2025: India's Exports Dance Past Storms, Waltzing into 2026 Boom!

India's exports demonstrated remarkable resilience amid a 50% US tariff shock and global disruptions, achieving record highs and signaling sustained growth into the new year. Exporters diversified markets, leveraged new FTAs, and benefited from policy support to maintain steady performance.

 

Export Resilience Amid Challenges:

The year 2025 emerged as the year of tariffs, with the United States imposing a steep 50% duty on Indian exports starting August, impacting key sectors immediately. Shipments to the US dipped in September and October, yet rebounded sharply by November with a 22.61% rise to USD 6.98 billion, showcasing quick adaptation through market diversification. Commerce Secretary Rajesh Agrawal noted that trade, like water, finds its own course, as India's goods and services exports hit a record USD 825.25 billion in FY25, up over 6% year-on-year. Despite geopolitical tensions, Red Sea disruptions, and WTO's cautious global trade outlook of 2.4% growth in 2025 slowing to 0.5% in 2026, Indian exporters stayed on track.

 

Strong November Surge:

November 2025 data underscored this momentum, with total exports including merchandise and services reaching USD 73.99 billion, a sharp 15.52% growth year-on-year. Merchandise exports climbed to USD 38.13 billion, up from USD 31.94 billion, while the trade deficit narrowed significantly. Cumulative April-November exports stood at USD 562.13 billion, reflecting 5.43% growth, driven by manufacturing and services sectors amid global uncertainties.

 

Key Growth Drivers:

2026 Outlook and Support Measures:

Projections point to solid expansion in 2026, with merchandise exports eyeing USD 525-535 billion and services USD 465-475 billion, potentially crossing USD 1 trillion total. New FTAs with UK, Oman, and New Zealand will unlock market access, alongside a Rs 25,060 crore export promotion mission and Rs 20,000 crore collateral-free credit. FIEO remains confident, citing policy backing and diversification, though MSMEs face logistics and volatility risks.

 

Sources: The Economic Times, News Arena India, DD News, Whalesbook, Times of India