Donald Trump had doubled the tariffs imposed on India to 50%, the initial impact of which was felt across many sectors. However, these Trump tariffs, which were implemented from August 27, now seem to be losing their effect, they have not had any significant impact on the Indian economy, and exports are now showing good growth. There was a significant increase in Indian export figures in November, while there was a decline in imports. The good news is that despite the many side effects of Trump tariffs, India’s trade deficit narrowed last month.
India’s trade deficit reduced
Despite the pressure of 50% tariff attack from the US, India has performed very well. Trade deficit decreased due to increase in exports in November. This reduction in trade deficit is due to the strong performance of the engineering goods, electronics and gems and jewelery sectors. According to PTI, India’s trade deficit narrowed to $24.53 billion in November, compared to $31.93 billion a year ago. Government data released on Monday showed that India’s merchandise trade deficit narrowed faster in November compared to October. In October, under pressure from tariffs, it was $41.68 billion. This reduction in trade deficit reflects business growth due to India’s strong exports and low imports.
November compensated for the loss
The US had initially imposed a 25% reciprocal tariff on India, and then doubled it to 50% after Donald Trump accused India of financially supporting Vladimir Putin in the Ukraine war by buying Russian oil and weapons. This had a significant negative impact on exports in September and October, but India’s strong strategy has neutralized the impact of the tariffs. After the release of government data, Commerce Secretary Rajesh Aggarwal said that exports in November compensated for the losses incurred in October this year.
Strong increase in exports, decrease in imports
According to the report, Indian exports grew by a strong 19.37% in November, reaching $38.13 billion, while Indian imports declined by 1.88% last month, reaching $62.66 billion. Rajesh Aggarwal described November as a good month for both India’s imports and exports. He said the services sector also remained strong, and India’s exports to the US alone increased by $1.3 billion to $6.98 billion in November compared to the previous year. Despite high tariffs of 50%, India’s goods exports to the US have remained stable.
Looking at India’s export-import data for the April-November period, merchandise exports increased to $292.07 billion, while imports increased to $515.21 billion. During the period, exports to the US reached $59.04 billion, up from $53.01 billion recorded in the same period a year ago.
Trading with other business partners
Among other trading partners, India’s exports to the United Arab Emirates (UAE) reached $25.49 billion, while imports stood at $40.81 billion. Imports from China increased to $84.27 billion, while imports from Russia decreased to $40.81 billion. The Narendra Modi government has taken several steps to protect the economy from external shocks such as US tariffs, including tax cuts, export incentives and labor reforms. These government measures are helping India deal with global trade challenges.