India’s merchandise exports rose 23.04% year-on-year to $44.40 billion in September 2026, supported by strong shipments of electronics, engineering goods and petroleum products. The merchandise trade deficit narrowed compared with a year earlier, although it increased from August as imports remained substantially higher than exports.
India’s September Exports Reach $44.40 Billion
India’s goods exports recorded strong growth in September 2026, reaching $44.40 billion compared with $36.08 billion in September 2025, according to data released by the Ministry of Commerce and Industry on October 15. The increase of 23.04% reflects improved export performance across several major industrial sectors.
The latest figures offer a positive signal for Indian businesses selling products in international markets. Electronics, engineering goods, petroleum products, chemicals and textile-related shipments contributed to the expansion. The performance also continued the upward trend in merchandise exports during the first half of the financial year 2026-27.
However, higher exports do not automatically mean that India’s overall trade position has improved across every comparison. Imports continued to exceed exports by a substantial margin, making the trade deficit an important indicator to watch in the coming months. <Cite refs={[“turn703107search12″,”turn703107search9”]}/>
Trade Deficit Narrows Year-on-Year but Rises From August
India’s merchandise trade deficit stood at $30.21 billion in September 2026, compared with $33 billion in September 2025. The year-on-year improvement came as exports grew faster than imports, helping reduce the gap between the value of goods sold abroad and goods purchased from overseas markets.
Merchandise imports increased by around 8% year-on-year to $74.61 billion, against $69.08 billion a year earlier. The slower pace of import growth, alongside stronger exports, helped limit the increase in the overall trade gap.
The month-on-month picture was different. India’s merchandise trade deficit widened from $26.86 billion in August to $30.21 billion in September. Imports rose from $70.67 billion to $74.61 billion during this period, while exports increased more modestly from $43.81 billion to $44.40 billion.
This distinction is important when assessing the latest trade figures. The deficit improved compared with the same month last year, but the gap expanded compared with the previous month. <Cite refs={[“turn703107search6″,”turn703107search7″,”turn703107search14”]}/>
Electronics and Engineering Goods Lead Export Growth
Electronics emerged as one of the strongest performers in September. Exports of electronic goods increased 70.44% year-on-year, rising from $3.11 billion in September 2025 to $5.31 billion in September 2026.
Engineering goods also recorded substantial growth. Exports in this category rose 20.91% to $12.17 billion from $10.06 billion a year earlier. Engineering products are an important component of India’s merchandise exports, covering a broad range of industrial and manufactured goods.
Petroleum product exports increased 31.90% to $6.22 billion, compared with $4.71 billion in the corresponding month last year. Organic and inorganic chemical exports grew 24.21% to $2.94 billion.
Textile-related exports also contributed to the overall improvement. Shipments of cotton yarn, fabrics, made-ups and handloom products increased 20.76% to $1.12 billion.
The growth across these categories suggests that September’s export performance was not limited to a single industry. However, sustained growth will depend on overseas demand, production costs, international competition and the ability of Indian companies to fulfil orders at competitive prices. <Cite refs={[“turn862224view0”]}/>
First-Half Merchandise Exports Rise 18.51%
The September performance added to the broader expansion in Indian merchandise exports during the first six months of FY27.
Between April and September 2026, merchandise exports reached $259.89 billion, compared with $219.30 billion during the corresponding period of the previous financial year. This represents growth of 18.51%, according to the government’s provisional trade figures.
Merchandise imports during the same six-month period increased to $437.53 billion from $376.17 billion. As a result, the cumulative merchandise trade deficit widened to $177.64 billion, compared with $156.88 billion in the first half of FY26.
The figures highlight two developments occurring simultaneously. Indian exporters are shipping more goods overseas, but the value of imports is also increasing. The difference matters because export growth alone does not determine the country’s overall merchandise trade balance.
For businesses, the first-half performance provides an encouraging indication of demand for Indian products. For policymakers, the challenge is to sustain export momentum while addressing the growing gap between merchandise imports and exports. <Cite refs={[“turn862224view0”]}/>
US and Asian Markets Show Stronger Demand
Export destinations also provide insight into where Indian shipments are gaining momentum. According to the Commerce Ministry’s September data, export values to the United States increased 47.99% year-on-year. Shipments to Singapore rose 169.16%, while exports to Malaysia increased 119.69%.
Exports to Egypt and China also recorded strong growth, rising 90.09% and 24.05%, respectively. These figures show that several overseas markets contributed to the expansion, although individual monthly growth rates can fluctuate depending on the products shipped and the comparison with the previous year.
For Indian exporters, access to multiple markets can help reduce dependence on a limited number of buyers. It can also create opportunities for manufacturers, suppliers and smaller businesses participating in international supply chains.
At the same time, export growth needs to be assessed against changing trade policies, tariffs, logistics expenses and demand conditions in importing countries. A strong month does not guarantee that the same pace will continue throughout the financial year. <Cite refs={[“turn862224view0”]}/>
Services Exports Present a Different Picture
India’s services trade provides another important part of the national export story. Unlike merchandise exports, which increased sharply in September, estimated services exports slipped slightly to $36.35 billion from $36.67 billion in September 2025.
The government’s combined merchandise and services figures show that total exports reached an estimated $80.75 billion in September, up 10.99% from $72.76 billion a year earlier. Total imports, including goods and services, were estimated at $94.05 billion.
The combined trade deficit narrowed to $13.30 billion from $14.17 billion in September 2025. These estimates include services data for September, which the government noted was based on estimates because the latest released Reserve Bank of India services data was for August.
For India, maintaining growth across both goods and services remains important. Manufacturing exporters and services businesses contribute differently to foreign earnings, employment and economic activity. Strong merchandise exports are encouraging, but the broader performance of the economy will depend on how both segments develop. <Cite refs={[“turn862224view0”]}/>
What India’s Export Performance Means for FY27
The latest trade figures provide a positive starting point for the second half of FY27, but maintaining momentum will require continued demand from international buyers and competitive production costs.
Electronics and engineering goods are particularly important to watch because they recorded strong growth and represent significant export values. Petroleum products and chemicals also contributed to September’s performance, while textiles added to the expansion across manufacturing categories.
The import bill remains a key concern. Higher imports can reflect domestic demand for energy, industrial inputs, machinery and consumer goods, but they also keep the merchandise trade deficit under pressure. In September, lower gold imports helped moderate overall import growth, while the increase in total merchandise imports still exceeded the rise in exports in absolute dollar terms.
The next set of monthly trade figures will help determine whether September represents sustained export strength or a particularly strong month. Exporters will also need to navigate international trade uncertainty, changing buyer requirements and price competition.
India’s 23.04% export growth is a significant development, but the larger test will be whether the country can maintain this pace while improving the balance between exports and imports.
Key Takeaways
- India’s merchandise exports increased 23.04% year-on-year to $44.40 billion in September 2026.
- The goods trade deficit narrowed to $30.21 billion from $33 billion a year earlier, but widened from $26.86 billion in August.
- Electronics exports rose 70.44%, engineering goods exports increased 20.91%, and petroleum product exports grew 31.90%.
- Merchandise exports reached $259.89 billion during April-September FY27, up 18.51% year-on-year, while the cumulative goods trade deficit widened to $177.64 billion.
Frequently Asked Questions
1. How much did India’s goods exports grow in September 2026?
India’s merchandise exports rose 23.04% year-on-year to $44.40 billion in September 2026, compared with $36.08 billion in September 2025.
2. Why did India’s merchandise trade deficit narrow year-on-year?
Exports grew faster than imports. Merchandise exports increased 23.04%, while imports rose by around 8%, reducing the deficit to $30.21 billion from $33 billion a year earlier.
3. Which sectors contributed most to export growth?
Electronic goods, engineering goods, petroleum products, organic and inorganic chemicals, and cotton yarn and textile products recorded strong growth. Electronics exports registered the highest percentage increase among these major categories.
4. Did India’s trade deficit also narrow compared with August 2026?
No. The merchandise trade deficit increased from $26.86 billion in August to $30.21 billion in September. It narrowed only when compared with September 2025.
