India’s Exports Defy Trade Headwinds as Shipments to US Rise 22% and China 52% in August

India’s merchandise exports to two of its largest trading partners recorded strong growth in August 2026, with shipments to the United States rising 21.83% year-on-year and exports to China increasing 52.35%, according to data released by the Ministry of Commerce and Industry.

The expansion came during a month in which India’s overall merchandise exports climbed to $43.81 billion, compared with $34.74 billion in August 2025. Combined merchandise and services exports were estimated at $82.68 billion, representing year-on-year growth of 25.41%.

The country-wise figures show that export growth was not confined to a single market. Singapore, Spain, China, Tanzania and the United States were among the destinations recording some of the strongest increases during the month.

Exports to United States Continue to Expand

Exports to the United States increased by 21.83% in August, making the country one of the principal contributors to India’s export growth during the month.

The performance is notable because Indian exporters are operating in a more difficult trade environment, with tariff measures and continuing negotiations over the future structure of India-US trade creating greater uncertainty for some sectors.

Despite those pressures, demand for Indian goods in the American market continued to expand in August.

The momentum was also visible over the first five months of the financial year. During April-August 2026-27, exports to the United States were up 6.17% compared with the corresponding period of the previous year.

Imports from the United States also rose sharply. They increased 65.78% year-on-year in August and were up 29.6% during April-August, indicating that bilateral merchandise trade is expanding strongly in both directions.

China-Bound Exports Rise More Than 52%

India also recorded a substantial increase in exports to China.

Shipments to the Chinese market rose 52.35% in August 2026 compared with the same month last year. Over the April-August period, exports to China grew 38.71% year-on-year.

The rise is significant because India’s trade relationship with China has historically been characterised by a large merchandise deficit, driven by heavy imports of electronics, machinery, industrial inputs and intermediate goods.

Imports from China continued to grow in August, increasing 17.07% year-on-year. During April-August, imports from China were up 27.01%.

While a single month cannot substantially alter the structural trade imbalance with China, export growth running considerably faster than import growth in August provides a positive indication for Indian companies seeking greater access to the Chinese market.

Singapore Emerges as Another Fast-Growing Market

Singapore recorded one of the sharpest increases among India’s major export destinations.

Exports to Singapore surged 160.96% in August compared with the corresponding month of 2025. During April-August, shipments to Singapore were up 96.56%, placing the country among the fastest-growing destinations for Indian exports during the current financial year.

Tanzania and Spain also registered particularly strong increases in August, while Malaysia featured among the major destinations showing strong growth during the first five months of 2026-27.

The geographical spread of the gains is important because diversification of export destinations reduces dependence on a small number of traditional markets and gives Indian manufacturers greater resilience against economic or political disruptions in individual regions.

Electronics and Engineering Goods Drive Merchandise Growth

The improvement in overseas demand coincided with strong growth across several important export sectors.

Electronic goods exports increased 89.82%, rising from $2.93 billion in August 2025 to $5.55 billion in August 2026. Engineering goods exports increased 24.86%, from $9.87 billion to $12.32 billion.

Petroleum product exports rose 63.27% to $6.81 billion, while organic and inorganic chemical exports increased 16.38%. Cotton yarn, fabrics, made-ups and handloom exports were up 13.79%.

The Commerce Ministry also recorded positive growth in marine products, pharmaceuticals, processed food products, coffee, plastics, rice, carpets and handicrafts during August.

The strong rise in electronics is particularly notable because it suggests that manufactured technology products are assuming a larger role in India’s export basket rather than growth being driven entirely by commodities or petroleum products.

Non-Petroleum Exports Maintain Momentum

Exports excluding petroleum products also showed healthy growth.

Non-petroleum exports reached $37 billion in August, compared with $30.57 billion a year earlier. When both petroleum and gems and jewellery are excluded, exports stood at $34.68 billion, compared with $28.26 billion in August 2025.

During April-August, non-petroleum exports increased to $180.61 billion, from $157.89 billion in the corresponding period last year. Exports excluding petroleum and gems and jewellery rose from $146.52 billion to $168.69 billion.

These figures indicate that the improvement in exports extends across a broad range of manufactured and processed products.

India’s Five-Month Exports Approach $400 Billion

The strong August performance lifted India’s combined merchandise and services exports during April-August 2026-27 to an estimated $399.27 billion, compared with $345.55 billion during the same period last year.

That represents growth of 15.55%. Merchandise exports alone rose 17.85%, reaching $215.91 billion compared with $183.21 billion a year earlier.

Services exports were estimated at $183.36 billion during April-August, up from $162.34 billion in the previous year. India generated an estimated services trade surplus of $86.71 billion during the period.

The Commerce Ministry has clarified that the latest RBI services data available are for July and that the August services figures are estimates subject to subsequent revision.

Imports Remain the Other Side of the Trade Picture

The strong export figures need to be considered alongside a continued expansion in imports.

Total merchandise imports increased to $70.67 billion in August, from $61.96 billion a year earlier. Over April-August, merchandise imports reached $363 billion, compared with $307.09 billion during the same period of 2025-26.

Consequently, the merchandise trade deficit for the first five months of the financial year widened to $147.09 billion, from $123.88 billion a year earlier.

The overall August picture was more favourable. Combined merchandise and services exports grew faster than imports, reducing the estimated monthly trade deficit from $11.62 billion in August 2025 to $9.41 billion in August 2026.

Export Growth Broadens Despite Global Uncertainty

August therefore delivered two encouraging signals for Indian trade.

First, exports expanded strongly across several major industrial categories, particularly electronics and engineering goods. Second, the growth was geographically diverse, with substantial gains recorded in the United States, China, Singapore and several other markets.

The sharp rise in shipments to the United States is particularly important at a time when bilateral trade is being reshaped by tariff measures and negotiations. Meanwhile, the 52.35% increase in exports to China shows that Indian exporters are also gaining ground in a market where the country continues to face a substantial structural trade imbalance.

The durability of these gains will depend on whether the momentum can be sustained over the coming months. But the August figures show that India’s export sector has entered the second half of 2026 with considerably stronger momentum, supported by manufactured goods and a widening range of overseas markets.

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