India’s merchandise imports soared to an all-time high of $76.1 billion in October 2025, representing a YoY expansion of 16.6%, owing to the tripling in gold imports aided by festive demand and possibly speculative/investment demand higher prices, as well as a robust 12.4% growth in non-oil non-gold items. In contrast, merchandise exports witnessed a base-effect led contraction of ~12% to $34.4 billion, driven by most key items, except electronic goods (+19.1%; exempted from US tariffs). This resulted in the merchandise trade deficit (MTD) peaking at $41.7 billion in October 2025, significantly exceeding the $26.2 billion seen in the year-ago month and the monthly average of ~$26 billion in H1 FY2026. While the trade deficit is expected to cool in November-December 2025 from these levels owing to a sequential dip in gold imports, the current account deficit (CAD) print is set to widen materially to ~2.4-2.5% of GDP in Q3 FY2026 from the ~1.8% of GDP expected in Q2 FY2026.

• India witnessed highest-ever deficit of $41.7 billion in October 2025: India’s merchandise trade deficit surged to an all-time high of $41.7 billion in October 2025 from $26.2 billion in October 2024. This was boosted by the 16.6% YoY surge in merchandise imports (to a record $76.1 billion), even as merchandise exports declined by ~12% (to an 11-month low $34.4 billion).
• Exports to US fell by 8.6% in October 2025: While exports to the US declined by 8.6% (-12% in Sep 2025), reflecting the impact of steep tariffs, those to other regions fell by a sharper 12.5%, reflecting the high base. Overall, exports to the US have contracted by 10.2% YoY during September-October 2025, after surging by 17.9% during 5M FY2026.