India’s merchandise exports are projected to decline slightly to USD 435 billion in the financial year 2024-25. The export sector faced a downturn in February 2025, with total merchandise exports dropping by 10.85% to USD 36.91 billion. Several key sectors, including petroleum products, gems and jewellery, ceramic products, and iron ore, have been significantly impacted.

Key Sectoral Performance

Sector	Performance in February 2025	11-Month Trend
Petroleum Products	Declined by 29.23%	Negative trend due to falling crude oil prices
Gems & Jewellery	Experienced a contraction	Demand fluctuations continue to affect exports
Ceramic Products	Showed a decline	Market challenges in key export destinations
Iron Ore	Registered a downturn	Global commodity price variations impacting demand
Engineering Goods	Declined by 8.62% in February 2025	Increased by 7.97% over the past 11 months

Comparison with Previous Year

Year	Total Merchandise Exports (USD Billion)
FY 2024	437.1
FY 2025 (Projected)	435

While the decline is not drastic, the contraction in key industries raises concerns about the long-term growth trajectory of Indian exports.

Key Factors Contributing to the Decline

1. Global Economic Conditions: Slowing demand in key international markets has impacted export figures.
2. Declining Crude Oil Prices: A major factor leading to reduced petroleum product exports.
3. Supply Chain Disruptions: Logistics challenges and higher freight costs affecting competitiveness.

Recommendations for Recovery

To mitigate the ongoing downturn and support Indian exporters, the following strategic interventions are recommended:

1. Low-Cost Export Credit: The government should consider offering low-cost financing options to ease financial pressures on exporters.
2. Technology Upgrade Incentives: Encouraging investments in advanced manufacturing technologies could enhance efficiency and product quality.
3. Diversification of Export Markets: Strengthening trade ties with emerging economies can help offset losses from traditional markets.
4. Policy Support for High-Growth Sectors: Increased focus on electronics, pharmaceuticals, and agricultural exports can drive future growth.

Conclusion

India’s export sector is facing short-term challenges, but with strategic policy interventions and global market recovery, it can regain momentum. Strengthening trade policies, fostering innovation, and offering financial support to exporters will be crucial in ensuring a stable and growing export environment in the coming years.