3 min readNew DelhiJan 16, 2026 07:30 PM IST
First published on: Jan 16, 2026 at 07:30 PM IST
India exported goods worth $38.5 billion in December 2025, a modest 1.8% increase over the $37.8-billion export figure recorded in December 2024, according to data shared by the Ministry of Commerce and Industry on Thursday.
In December, India imported far more goods than it exported, as it often does. Total goods imports during the month were pegged at $63.55 billion. This is almost 9% more than what India imported in December 2024. That means the trade deficit — the gap between exports and imports — for December 2025 was $25 billion.
The crucial bit of interest in this data was to ascertain whether a trend was emerging in the aftermath of the 50% tariffs imposed by the Donald Trump administration beginning August. It is also of interest how India’s exports to the rest of the world have behaved — not just the US — in the wake of these exceptionally high US tariffs.
A data analysis by HSBC Global Investment Research has thrown up some key takeaways.
Sequential momentum has weakened
Instead of looking at year-on-year (y-o-y) growth rates, a look at the month-on-month (m-o-m) data (after adjusting for seasonal variations) shows that India’s export momentum has weakened.
“The sequential momentum which was averaging 0.7% m-o-m sa (seasonally adjusted) in Jan-Jul 2025 (led partly by frontloading demand) has fallen to a meagre 0.1% in Aug-Dec 2025 (post the implementation of the 50% US tariff),” says the HSBC note.
The weakness is across the board: While it is still positive, the growth in the exports of electronics, engineering goods, petroleum and textiles has slowed. Moreover, export growth in pharma, chemicals, and gems & jewellery has fallen on a sequential basis.
India’s exports to the US fell
Not surprisingly, thanks to the effect of tariffs, India’s exports to the US fell both on an annual and sequential basis (see chart). HSBC found that the average sequential momentum of export growth fell from 1.9% during January and July 2025 to -1.4% during August and December owing to the 50% tariffs.
Marginal rise in exports to China
This has risen, but the increase is too small (around $2 billion a month) to offset the drag created by the fall in exports to the US (around $7 billion).
Exports to the rest of the world (apart from the US and China) have been flat.
Lower export levels put pressure on India’s currency. This is because low exports imply lower demand for Indian currency, thus putting pressure on the exchange rate.
Overall, the muted growth in exports means that Indian policymakers must redouble their efforts to find newer markets and deepen existing ones outside the US in order to ensure that the high tariffs don’t derail exports.
Indian policymakers must redouble their efforts to find newer markets and deepen existing ones outside the US. (NYT File) 
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