IN THE midst of global volatility and growing geopolitical tensions, India has clocked a good rise in its exports. During the April-September period this fiscal, India’s exports went up 18.51 per cent to USD 259.89 billion and the trade deficit narrowed to USD 30.21 billion. The Government data has noted a 23 per cent increase in exports in September underlining a positive trend and keeping the growth projections intact. Significant among these figures are the shipments to the United States despite tariff-related problems. It is a good sign before the conclusion of the trade deal between New Delhi and Washington but there is also a need to go beyond the numbers and find out whether rising exports have translated into rising profits. The hike in exports is a signal that Indian products are in good demand in the world. Indian businesses have kept the top markets in the US and China engaged as the numbers suggest. Yet, the real story lies in the widening trade deficit with these two top economies.

 

The rise of Indian exports need to be measured with two scales -- one for the US and China, and other for the rest of the world. The difference will tell the exact status of the export story. While India’s exports went up by 23 per cent, its imports, too, were up by 8 per cent to USD 74.61 billion in September. The figures related to the United States and China offer a clue. During April-September 2026 period, India’s merchandise exports to the US reached USD 50.81 billion, up from USD 45.73 billion a year.

 

This is an increase of about 11.1 per cent as per the Government figures. The number sends a good feeling about trade relations between the two partners despite stuttering trade negotiations and fresh tariff threats from the Trump administration. But the latest figures offer a clue. India's merchandise exports to the US reached $50.81 billion during April-September 2026, up from $45.73 billion a year earlier. This is an increase of about 11.1 per cent, according to the latest trade figures reported by the government. The numbers suggest that US demand for Indian products has not gone down despite tariffs. But the numbers do not show what impact tariffs have had on the exports. There is a possibility of some businesses settling for lower margins to retain customers. Therefore, exports might have grown but they must have come with some costs. In the overall context, the US-bound shipments have gone up but not at the same pace as merchandise exports have as a whole.

 

China also presents a different story. India is exporting more but it is importing far more from the neighbouring country. India’s exports to China reached USD 19.26 billion in January-September 2026 while the imports stood at USD 125.19 billion. The gap between the two was USD 105.93 billion. China supplies India with electronics, machinery, chemicals and other industrial inputs while India sells a smaller basket of goods including ores, fuels, seafood and agricultural products. The key is in the size of the trade flows. The growth in exports demands scrutiny from all angles. Higher exports do not mean higher profits. Businesses often offer discounts to keep overseas buyers interested. The actual number should be ascertained on long-term gains. Expanding exports will be crucial for India in the future but it will also have to focus on the size and value of the merchandise. Tariffs are still a threat for Indian exports to the US till the closing of the trade agreement. After the deal, the strict quality standards in the US will also be a major hurdle to cross for Indian merchandise. Products with high value and lower duties entering the US market will be a real exports success story for India. Reducing trade deficit will also be a key area of concern and it will require Indian businesses to become more competitive. A healthy alternative at home can only stop the products that China supplies in huge quantities. India cannot simply stop importing Chinese goods but it will have to match their quality in domestic production. That is the real challenge.