India’s Trade Gap Widens to 8-Month High as Imports Rise

By Shruti Srivastava

Aug 14, 2025 (Bloomberg) –India’s trade deficit widened to an eight-month high in July, as the rise in inbound shipments outpaced the growth in exports. 

The gap between exports and imports stood at $27.35 billion last month, data showed Thursday. That’s the highest since November last year and more than the $21.5 billion deficit forecast by economists in a Bloomberg survey. The trade deficit narrowed to $18.78 billion in June. 

Inbound shipments rose 8.6% in July to $64.59 billion from a year earlier, while outbound shipments stood at $37.24 billion, up 7.3%, according to the data. 

India’s inbound shipments were driven by a sharp jump in oil and gold imports. The average price of Indian crude basket last month was $70.95 per barrel, the highest in the first four months of the current fiscal year, according to government data.

Oil imports rose $15.5 billion last month, compared to $13.7 billion in June, while gold imports came in at $3.9 billion, up from 1.8 billion the previous month. 

Tariff Blow

The data comes against the backdrop of US President Donald Trump imposing a 25% reciprocal tariff on India and then doubling the levies to 50% as penalty for buying Russian oil. Indian officials have maintained that the nation’s weighted average tariffs remain competitive with or at par with other developing countries, and backed its ties with Moscow. 

The US president’s latest jibes have stunned officials in New Delhi and have raised concerns over the South Asian nation’s manufacturing ambitions. Bloomberg Economics estimates Trump’s 50% tariffs could cut outbound shipments to the US — India’s largest export market — by 60% and shave about 1% from gross domestic product. To mitigate the impact of tariffs, exporters have been trying to front load the shipments to the US. 

Washington is an “important partner” for India and the nation is “fully engaged” with the US on trade negotiations, Commerce Secretary Sunil Barthwal told reporters at a press briefing in New Delhi. 

After Trump’s 50% tariff blow, India and China are stepping up efforts to ease long-standing tensions. Prime Minister Narendra Modi is expected to head to China for the first time in seven years for the Shanghai Cooperation Organisation, while Chinese Foreign Minister Wang Yi will likely travel to New Delhi next week. 

A high-level Indian delegation is also visiting Russia from Aug. 20-21, an official told reporters on Thursday, asking not to be named as the discussions are private. 

© 2025 Bloomberg L.P.

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