Recovery In Developed Markets Will Drive Exports’ Growth During 2025

New Delhi: India’s growing capabilities in high-value sectors like machinery and electronics are supporting the country’s exports, amid global uncertainties caused by conflicts, and the gradual economic recovery in developed markets offers improved growth prospects for the Indian exporting community in 2025.

Trade experts suggest that if the new US administration imposes higher tariffs on China, Mexico, and Canada, Indian exporters could benefit further by seizing those opportunities. They noted that the possible intervention of the new US administration under Donald Trump to end the Russia-Ukraine conflict could ease the Red Sea crisis, streamline global supply chains, and reduce shipping costs for traders.

However, Trump’s threat for reciprocal tariffs on Indian goods may have an impact on the country’s outbound shipments, as additional duties affect exporters’ competitiveness. The European Union’s green regulations, including the Carbon Border Adjustment Mechanism (CBAM) and deforestation laws, also threaten to increase export costs and complicate free trade negotiations. The commerce ministry is in the process of formulating a strategy to push exports of six key product categories, including engineering goods and electronics, to 20 focus countries including the US, Australia, France, China, Russia, the UK, Japan, South Korea, Singapore, and Indonesia.

During April-November this fiscal, exports increased by 2.17 per cent year-on-year to USD 284.31 billion despite global uncertainties, while imports rose by 8.35 per cent to USD 486.73 billion. Trade deficit, the difference between imports and exports widened to USD 202.42 billion from USD 170.98 billion during April-November 2023.