Industry Odisha Bureau,Aug 14: India’s merchandise exports reached $44.2 billion in July 2026, advancing 19.6% year-on-year. The increase reflected continued diversification across multiple geographic markets, officials said Thursday. However, India’s overall trade deficit widened significantly to $15 billion in July.
The goods export surge reflected broad market diversification across several key regions. Exports to China jumped 65% to $2.2 billion during the month of July. Over April-July, China exports advanced 36%, indicating sustained momentum in that market. Shipments to Singapore, Japan, South Korea, Taiwan, Vietnam, Austria and Malaysia strengthened. African destinations including Kenya, Tanzania, and South Africa recorded particularly robust growth.
West Asia’s recovery proved especially significant given severe earlier disruption in the region. Indian exports to West Asia contracted nearly 57% in March of 2026. April saw further declines of 27% as regional turmoil disrupted maritime logistics. By July, West Asian shipments recovered to $5.7 billion, up 8.8% annually.
The recovery was achieved through alternative ports and rerouted maritime shipping lines. “Some new ports became operational handling significantly more cargo,” Agrawal said Thursday. Ports in Oman outside the Strait of Hormuz increased handling capacity substantially. Two United Arab Emirates ports Fujairah and Khor Fakkan absorbed significantly increased traffic volumes.
Normally, Dubai’s Jebel Ali port handled the bulk of regional cargo flows. Currently, operational constraints at Jebel Ali forced diversification toward alternative port infrastructure. This infrastructure adaptation enabled India’s exporters to recover momentum in West Asian markets.
Merchandise imports grew more slowly than exports at 17.5% to $76.2 billion. However, services imports expanded faster than services exports, complicating the trade picture. Services exports grew 6.4% to $35.9 billion, a relatively subdued pace. Services imports accelerated 9.5% to $18.9 billion, outpacing export growth quite considerably.
Faster services import growth than export growth drove the overall trade deficit wider. Combined merchandise and services trade deficit reached $15 billion in July 2026. That compares to an $11.4 billion combined deficit during July 2025. The widening deficit reflects ongoing import pressures despite strong merchandise export resilience.
The goods export recovery demonstrates India’s expanding supply-chain flexibility amid significant disruption. Export diversification across multiple markets and alternative shipping routes provided crucial resilience. However, stronger services imports than exports suggest that continued external-sector pressure lies ahead.
