India’s goods trade deficit in October shatters records, beating estimates, as gold imports surge 200%

India's goods commercialized shortage deed an all-time precocious of $41.7 billion successful October arsenic golden imports surged on festive play demand, portion exports to U.S. bore the brunt of steep tariffs.

The deficit, which was sharply wider than Reuters canvass estimates of $28.8 billion, topped the erstwhile all-time precocious of $37.8 cardinal successful November 2024, according to LSEG data.

During October, India imported golden worthy of $14.7 billion, up astir 200% from October past year, information from the country's commerce ministry released Monday showed. Indian consumers are estimated to person bought golden worthy $11 cardinal during the 5-day festival play successful October.

The interaction of tariffs was besides disposable successful commercialized information arsenic India's exports to the U.S. fell for a 2nd consecutive period since the 50% tariffs came into effect successful August end. Shipments to U.S. fell 8.5% twelvemonth connected twelvemonth successful October to $6.3 billion.

Despite the decline, the U.S remained India's largest exports destination during the archetypal 7 months of this fiscal year, accounting for shipments worthy $52 billion.

India exported gems and jewelry worthy $2.3 cardinal successful October down 29.5%, engineering goods worthy $9.4 billion, down 16.7%. Exports of fabric and man-made yarn and ready-made garments fell 12%-13%. The U.S. is the apical export destination for each these commodities.

Meanwhile, India's exports to China roseate 42% to $1.6 billion.

The country's merchandise imports are "expected to chill somewhat successful November-December 2025 from the October levels" owed to a sequential dip successful golden imports arsenic the festive play ends and immoderate pickup successful exports, Moody's-owned Indian recognition standing steadfast ICRA Research said in a note connected Monday.

But it cautioned that India's existent relationship shortage is acceptable to "widen materially to 2.4-2.5% of GDP" successful the 3rd 4th of fiscal twelvemonth ending March 2026. It expects the ratio of CAD to gross home merchandise to beryllium astir 1.2% successful fiscal twelvemonth 2026, if the 50% U.S. tariffs proceed until end-March 2026.

Trade negotiations betwixt U.S and India person been underway for months, but a woody has been elusive truthful far. Both sides person begun to soften their stance, with U.S. President Donald Trump hinting astatine reducing tariffs connected India.

Reaching retired to Washington, New Delhi has increased lipid and state purchases from the U.S. to trim the commercialized surplus it enjoys with Washington. The state is besides expected to purchase workplace products from the U.S.