Merchandise exports rebound in July; U.S. talks in focus

Latest reading: Merchandise exports rose 7.3% in annual terms in July, on the heels of June’s 0.1% decrease. Meanwhile, merchandise imports climbed 8.6% over the same month last year in July (June: -3.7% yoy). As a result, the merchandise trade balance deteriorated from the previous month, recording a USD 27.4 billion deficit in July (June 2025: USD 18.8 billion deficit; July 2024: USD 24.8 billion deficit). Lastly, the trend pointed down, with the 12-month trailing merchandise trade balance recording a USD 290.4 billion deficit in July, compared to the USD 287.8 billion deficit in June.

Outlook: Key to the outlook for goods exports ahead will be trade talks with the U.S.; in early August, the U.S. hit India with an additional 25% tariff for buying Russian oil, bringing total levies up to 50%.

Panelist insight: On the impact of current U.S. tariffs, EIU analysts said: “We still believe that a bilateral trade agreement of some form will manifest in the months ahead, with complicated issues left for future discussions […]. If the 50% tariff on India remains in place for the rest of fiscal year 2025/26 (April-March), we believe that it will reduce GDP growth to 5.8%, from our current forecast of 6.2% (under the baseline 25% tariff rate).”

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Indian trade projections for the next ten years from a panel of 9 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable trade forecast available for Indian trade.

Download one of our sample reports to visualize what a Consensus Forecast is and see our Indian trade projections.

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