Exports

India’s exports to China witnessed a robust 67% year-on-year increase in December, underscoring the strengthening trade relations between the two Asian economies. The surge was largely driven by engineering goods, pharmaceuticals, and chemicals, reflecting India’s competitive manufacturing capabilities. This growth is notable against the backdrop of global trade volatility and supply chain realignments. Analysts highlight that the spike signals renewed demand for Indian goods in the Chinese market and indicates potential for further diversification of export portfolios.

India’s merchandise exports rose to USD 38.5 billion in December, reflecting steady demand across key global markets despite persistent economic headwinds. The uptick points to improving performance in sectors such as engineering goods, pharmaceuticals, and refined petroleum products, even as exporters navigate currency volatility and softer consumption in parts of the world. The data underscores the relative resilience of India’s external sector at a time when global trade growth remains uneven.

As preparations for the Union Budget 2026–27 gather pace, policymakers are increasingly focusing on import duty rationalisation as a lever to boost India’s export competitiveness. Industry stakeholders argue that high and uneven duties on raw materials and intermediate goods inflate production costs, eroding the pricing advantage of Indian exporters in global markets. A calibrated restructuring of customs duties could lower input costs, streamline supply chains and enhance value addition.

India’s electronics exports have crossed the Rs. 4 lakh crore milestone, marking a significant step in the country’s transition toward high-value manufacturing and export-led growth. The surge reflects the combined impact of production-linked incentive schemes, rising global demand for electronics and India’s expanding role in global supply chains. Smartphones, consumer electronics and electronic components led the growth, supported by strong investments from global and domestic players.

India’s long-term economic growth will increasingly depend on its ability to reduce excessive import reliance while significantly expanding exports, according to policymakers and industry leaders. As global trade patterns shift and supply chains realign, strengthening domestic manufacturing and improving export competitiveness have emerged as strategic priorities. A balanced trade framework, supported by policy reforms and infrastructure investment, is seen as critical to improving foreign exchange stability and job creation.

India is increasingly focusing on recalibrating its trade strategy to foster sustainable economic growth. Policymakers emphasize the need to reduce dependence on imports while enhancing export capabilities across sectors such as manufacturing, electronics, and pharmaceuticals. A strategic reduction in imports, especially of non-essential and high-cost goods, aims to improve the trade balance, conserve foreign exchange reserves, and strengthen the rupee.

Ramesh Juneja has been appointed chairman of the Council for Leather Exports, marking a leadership transition at a critical juncture for India’s leather and footwear industry. His appointment comes as exporters navigate shifting global demand, sustainability requirements, and competitive pressures from overseas markets. Industry stakeholders expect the new leadership to focus on strengthening exports, improving compliance standards, and enhancing India’s global positioning in value-added leather products.

The Indian government has extended the Minimum Export Price (MEP) for honey exports until March 2026, signaling continued support for the country’s apiculture sector amid rising global demand. The MEP, which sets a floor price for honey exports, aims to protect domestic producers from undervaluation, curb cheap imports, and enhance competitiveness in international markets. This move is expected to stabilize export revenues, encourage quality compliance, and strengthen India’s position as a leading honey exporter.

The government has approved Rs. 4,531 crore in market access support aimed at strengthening India’s export competitiveness and expanding the global footprint of domestic producers. The funding is designed to help exporters overcome non-tariff barriers, improve market penetration and adapt to evolving international trade standards. By offering targeted assistance across sectors, the initiative seeks to reduce entry costs in overseas markets while supporting branding, compliance and outreach efforts.

The European Union’s carbon border tax is set to reshape trade dynamics for Indian steel and aluminium exporters by imposing levies linked to carbon emissions embedded in production. The measure, aimed at preventing carbon leakage and enforcing climate accountability, could raise costs for Indian manufacturers that rely heavily on fossil fuels. As Europe tightens its environmental standards, Indian exporters face margin pressure, compliance burdens and the risk of losing competitiveness in a key market.