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India’s trade deficit widened to $25.04 billion in December due to subdued exports amid geopolitical challenges and trade restrictions, even as a top official claimed that the country and the US are “very close” to conclude a deal that would lower tariffs.
India’s exports increased by 1.87 per cent to $38.51 billion in December, from $37.80 billion recorded in the same month of the previous year. The country’s goods imports climbed to $63.55 billion during the month under review, registering an increase of 8.7 per cent over $58.43 billion recorded in December 2024, as per data released by the Ministry of Commerce and Industry on Thursday.
Trade deficit widened from $20.63 billion in December 2024, to $25.04 billion in December 2025. In November 2025, the trade deficit stood at $24.53 billion.
Commerce Secretary Rajesh Agrawal said exports remained in positive territory despite global uncertainties.
On the proposed India-US bilateral trade agreement, Agrawal said the two countries are constantly engaged in negotiations. There are pending issues being talked about. It's very near, but we can't put a deadline. Deal will happen when both sides are ready, and we're ready to announce," he said.
He informed that Commerce and Industry Minister Piyush Goyal and US Trade Representative Jamieson Greer held a virtual meeting last month to discuss the proposed trade deal. “There are pending issues being talked about. It's very near, but we can't put a deadline. Deal will happen when both sides are ready,” Agrawal told reporters.
The Commerce Secretary underlined that despite the high tariffs, India’s monthly export to the US has averaged around $7 billion. India’s export to the US in the first nine months of the current fiscal was 9.75% higher, when compared with the corresponding period of the last year.
In the April-December period, the US, the UAE, and China were India’s top-3 export destinations. Exports to China surged by 36.68% year-on-year, during this period.
Cumulatively, during April-December this fiscal, India’s merchandise exports increased by 2.44 per cent to $330.29 billion, while imports jumped by 5.9% to $578.61 billion, leaving a trade deficit of $248.32 billion during the first nine-month of 2025-26.
India’s total exports (merchandise and services combined) declined by 1.01 per cent to $74.01 billion in December, while total imports rose by 6.17 per cent to $80.94 billion.
Going by the trend, according to Agrawal, India’s overall exports are likely to cross $850 billion in the current fiscal.
Federation of Indian Export Organisations (FIEO) President SC Ralhan said India’s exports performance so far in the current fiscal has been encouraging, given the volatility in global trade flows.
“India’s top export destinations — the US, the UAE, China, the Netherlands, the UK, Germany, Bangladesh, Singapore, Saudi Arabia, and Hong Kong — demonstrate a well-diversified and resilient export footprint,” Ralhan added.
“This diversification is particularly critical at a time when global trade routes are being reshaped due to geo-political conflicts, sanctions, shipping disruptions and strategic realignments,” he mentioned.