India’s exports slip 7.44% to USD 38.92 billion in March on West Asia shipping disruptions

India’s merchandise exports declined 7.44 per cent to USD 38.92 billion in March, government data showed on Wednesday, as the ongoing West Asia crisis disrupted key global shipping routes, including the Strait of Hormuz , and raised freight and insurance costs.

Imports also fell 6.51 per cent to USD 59.59 billion compared with the year-ago period, reflecting reduced crude oil and gold purchases along with broader global demand softness. The combined decline led to a trade deficit of USD 20.67 billion , which was lower than market expectations, indicating some cushioning from falling imports.

Officials said the sharp disruption in West Asia severely impacted India’s trade flows with the region. Exports to the Middle East plunged 57.95 per cent in March , while imports from the region also fell 51.64 per cent , driven by instability in key maritime corridors and reduced shipping activity through critical chokepoints.

According to Commerce Secretary Rajesh Agrawal , India’s external sector remains broadly resilient despite short-term shocks. He said total exports of goods and services rose 4.22 per cent to USD 860 billion in 2025–26, supported by steady services exports and diversified global demand.

On a yearly basis, merchandise exports during April–March 2025–26 increased marginally by 1 per cent to USD 441.78 billion , while imports rose to USD 774.98 billion . Services exports were estimated at USD 418.31 billion , continuing to play a key role in stabilising India’s external account.

Recent updates also indicate that exports to the United States helped offset part of the Middle East decline, with stronger demand supporting overall shipments in March despite regional shocks. At the same time, crude oil imports fell sharply by over 36 per cent, reflecting lower energy intake amid global price volatility.

Officials noted that trade disruptions were also linked to heightened geopolitical tensions in the region, which impacted not only volumes but also logistics costs and shipping reliability.

The government also reiterated that the proposed India-UK free trade agreement is expected to come into force next month, potentially strengthening export performance in the coming quarters.