Goods exports slip 12%; gold imports push trade deficit to an all-time high

Aditi Nayar, chief economist, ICRA, said that imports surged amid a year-on-year tripling of gold imports to $14.7 billion, even as oil imports declined in the month. While gold imports surged, non-oil and non-gold imports also saw an uptick, Nayar said. “The non-oil non-gold imports rose by a substantial 12.4 per cent year-on-year, led by fertilisers, machinery, electronic goods, non-ferrous metals, and silver,” Nayar said.

Official data showed that India’s imports surged 16.63 per cent to $76.06 billion driven by a jump in gold, silver and fertiliser imports, and exports declined 12 per cent to $34.38 billion. While gold imports jumped by 200 per cent to $14.7 billion, silver jumped 528 per cent to $2.7 billion.

The trade deficit widened sharply to $41.68 billion in October after it had surged to $31.15 billion in September. This came despite a dip in crude oil imports to $14.8 billion in October compared to $18.9 billion in the same month last year. Commerce Secretary Rajesh Agrawal said despite global uncertainties, Indian exporters are holding ground, adding that the decline in exports in the last month is largely due to the base effect.

While engineering goods shipments fell 16.71 per cent to $9.37 billion, exports of ready-made garments slipped over 8 per cent. Gems and jewellery exports slipped over 26 per cent, but electronic exports jumped 25 per cent.

Federation of Indian Export Organisations (FIEO) president SC Ralhan said that pressure on exports reflects the broader global economic slowdown, marked by geopolitical uncertainties, subdued demand in several key markets, and persistent commodity price fluctuations. Despite such adverse conditions, Indian exporters have shown resilience, while increased logistics costs and volatile input prices are challenging competitiveness, he said.

“Increase in imports—especially of critical inputs and components—reflects the Indian manufacturing sector’s continued dependence on imported raw materials. Strengthening domestic supply chains, ensuring the timely availability of raw materials, and accelerating self-reliance efforts in key sectors should remain priority areas,” he said.

Pankaj Chadha, chairman, Engineering Export Promotion Council of India (EEPC India), said, after recording positive growth for four consecutive months in the current fiscal year, engineering goods exports declined sharply in the month of October 2025, reflecting the impact of punitive tariffs imposed by the Trump administration.

The decline in engineering goods shipments in October was expected, considering that the 50 per cent tariff imposed by the US came into force in the last week of August.

With government support, the engineering goods sector has managed to minimise the impact of the US tariffs, he said.

“The timely support extended by the government has significantly helped the engineering sector that are facing external challenges. The RBI also introduces measures to provide relief to exporters in light of the persistent global challenges affecting the country’s overall export sector,” Chadha added.

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