India’s merchandise trade deficit widened to $30.21 billion in September 2026, compared with $26.86 billion in August. The increase came as imports grew faster than exports, according to government data, amid rising crude oil prices and global supply disruptions.

Merchandise imports rose to $74.61 billion in September from $70.67 billion in August. Meanwhile, exports increased to $44.40 billion from $43.81 billion. Despite the wider trade gap, export growth remained strong across several key sectors.

Rising oil prices have added pressure to India’s import bill. Brent crude prices remained above $100 per barrel amid escalating tensions between the United States and Iran. Disruptions to global energy supplies have also raised concerns about inflation and the country’s external trade balance.

Trade Secretary Rajesh Agrawal highlighted the strength of India’s exports across sectors, including petroleum products, meat, dairy, poultry, electronics, handicrafts and engineering goods.

India is also working to diversify its export markets through new trade agreements. Its agreement with New Zealand is scheduled to take effect next week, while the UK trade pact is already operational and a broader agreement with the European Union is progressing towards implementation.

Automobile exports provided additional support. Vehicle shipments increased 22.5% year-on-year to 684,481 units in September 2026. Two-wheeler exports rose 26.8%, although passenger vehicle exports declined 2.2%.

Services exports were estimated at $36.35 billion in September, while services imports stood at $19.44 billion. Gold imports also declined to $1.8 billion from $2.3 billion in August.

The United States remained India’s largest export destination during April–September, with merchandise exports rising to $50.81 billion from $45.82 billion a year earlier.

Although India’s exports continue to expand, higher import costs and energy market uncertainty remain key challenges. Export diversification and stronger performance across manufacturing and services could help support India’s trade outlook in the coming months.