India’s trade performance demonstrated stability and moderate growth during the first quarter of the current financial year, according to a NITI Aayog Trade Watch report released on Wednesday.

The publication offers a holistic snapshot of India’s trade position, combining global demand-supply perspectives, sectoral performance, and insights into emerging trade opportunities.

Merchandise exports showed restrained growth, influenced by declines in critical sectors such as iron and steel, as well as natural and cultured pearls. On the other hand, imports were propelled by high-value commodities, including aircraft, spacecraft, mineral fuels, and vegetable oils. Services exports displayed an encouraging surplus, the 40-page report states.

According to the highlights of the report, India’s total trade in H1 2024 experienced a 5.45 per cent year-on-year increase compared to 2023.

Merchandise imports showed consistent growth, with Q1 FY25 exports rising by 5.95 per cent to $110 billion and imports increasing by 8.40 per cent to $173 billion, leading to a growing trade imbalance.

In Q1 FY25, Indian iron and steel exports experienced a massive decline (33 per cent) primarily due to weak domestic demand and excess capacity in China which resulted in an oversupply of steel in the global markets.

In Q1 FY25, North America accounted for 21 per cent of India’s exports, followed by the EU at 18.61 per cent. Imports were largely from Northeast Asia, West Asia (GCC), and ASEAN, making up 51 per cent of total imports.

During Q1 FY25, export growth to FTA partners was notably strong at 12 per cent, while import growth from these partners was 10.29 per cent.

According to the report, in Q1 FY25, North America accounted for 21 per cent of India’s exports, followed by the EU at 18.61 per cent. Imports were largely from Northeast Asia, West Asia (GCC), and ASEAN, making up 51 per cent of total imports.

The impact of international trade on development outcomes has intensified as it has been proven that cross-border trade is correlated with rising living standards and poverty reduction. India’s trade landscape is rapidly evolving in response to global challenges and opportunities. In this context, the Trade Watch Quarterly Report Q1’FY25 offers a comprehensive analysis of India’s trade performance, assessing trade dynamics, and identifying potential sectors and key markets while also analysing the impact of geopolitical tensions.

NITI Aayog CEO B.V.R. Subrahmanyam emphasised the importance of data-driven approaches and evidence-based policymaking.

He stated that by providing a detailed analysis of India’s trade position each quarter, the publication will support evidence-based policymaking.

"This initiative is aligned with the commitment to strengthening India’s trade competitiveness in line with the aim to capitalise on India’s trade potential for Viksit Bharat (India@2047) and to ensure sustainable growth in a rapidly changing global trade environment," Subrahmanyam mentioned.