India’s trade deficit narrowed to $6.6 bn in May on low oil prices, strong services exports-OxBig News Network

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India’s overall trade deficit narrowed to $6.6 billion in May 2025, down nearly 30% over its level in May last year, as total imports fell largely due to a fall in oil prices while total exports grew on the back of a strong performance by the services sector, official data showed.

According to the monthly trade data released by the Ministry of Commerce and Industry on Monday, India’s total exports grew to $71.1 billion in May 2025, up from $69.2 billion in May 2024. This 2.8% growth in total exports was due to a strong showing by the services sector, which saw exports growing 9.4% to $32.4 billion.

Merchandise exports, on the other hand, contracted 2.2% in May 2025 to $38.7 billion. According to Commerce Secretary Sunil Barthwal, a large part of the reason for this subdued performance in merchandise exports is due to the fall in global oil prices.

“For May, there is positive growth in non-petroleum exports because petroleum, in times of crisis, there is a lot of volatility,” Mr. Barthwal said at a briefing on the trade data. “Currently, there is new volatility that has come. And we have also seen, in the last two months, there was a sustained fall in prices in petroleum, which has got a dampening impact on exports.”

The data shows that India’s non-petroleum exports grew 5.1% in May 2025.

Merchandise imports, too, were impacted by falling oil prices. While total merchandise imports contracted 1.7% in May 2025, the non-petroleum imports grew 10% in the same month. Services imports grew 1.5%. Taken together, total imports contracted 1% in May 2025.