India’s merchandise exports increased by 15.5 per cent (year-on-year) to $40.41 billion in June this year, compared with the corresponding figure of $34.98 billion in the same month last year, according to data released by the Commerce Ministry on Monday.

However, the surge in imports driven by higher global crude oil and precious metal prices outpaced export growth, which led to a widening of the merchandise trade deficit to $30.43 billion in June.

Imports rose at a faster pace of 31 per cent to $70.84 billion, compared with $54.08 billion a year ago, pushing the trade deficit up nearly 59 per cent from $19.10 billion in June 2025.

On a sequential basis, however, merchandise exports declined to $40.41 billion in June from $45.20 billion in May, while imports eased to $70.84 billion from $73.41 billion.

The sharp rise in imports is primarily due to higher global prices of crude oil and precious metals, particularly petroleum and gems and jewellery.

The government also highlighted a widening trade deficit in petroleum, electronics, and gems and jewellery. Officials noted that rising disposable incomes and robust demand from India's growing middle class have continued to drive higher imports of electronic goods.

In April-June, India's overall goods exports rose about 15.9 per cent to $129.32 billion compared to the same quarter of the previous year, despite the uncertainties in global markets, officials said.

Exports to Gulf countries have recovered to pre-war levels, rising to $5.3 billion in May from $2.62 billion in March as traders shifted to alternative shipping routes, while exports to the United States edged up to $17.29 billion during April and May.

India is also broadening access to other developed markets, with a UK free trade pact set to take effect this month, and an EU agreement expected by early next year.

Commerce Secretary Rajesh Agrawal said that regions outside NAFTA and Europe now account for more than half of India's merchandise exports, reflecting continued diversification of export markets.