India’s trade dynamics with the United States witnessed a robust shift in the first quarter (April–June) of FY 2025–26, with exports soaring and imports declining, positioning the US as India’s top trading partner during the period. This comes amid ongoing negotiations for a bilateral trade agreement between the two nations—an encouraging signal for exporters, investors, and policymakers alike.

Trade Snapshot: June & Q1 Overview

Exports to the US in June 2025 increased by 23.53%, reaching USD 8.3 billion, while imports fell by 10.61%, totaling around USD 4 billion. For the April–June 2025 quarter, exports grew by 22.18% to USD 25.51 billion, helping generate a positive trade surplus and reinforcing India’s pivot toward the US market.

Key Trade Metrics (June & Q1 FY 2025-26)

Trade Indicator	June 2025	April–June 2025-26
Exports to US	USD 8.3 billion	USD 25.51 billion (+22.18%)
Imports from US	USD 4 billion (-10.61%)	–
Trade Surplus with US	USD 4.3 billion (June)	Increasing
US Position in Trade Rankings	Top Trading Partner	Top Trading Partner
Exports to China	USD 1.38 billion (+17.18%)	–

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Broader Export Trends

Exports to countries such as China, Singapore, and Germany also showed positive growth, indicating market diversification. However, some traditional partners like the UAE and UK witnessed a decline in Indian exports, highlighting the need for recalibrated trade engagement.

Import Patterns: A Mixed Bag

• Decline in Imports: From UAE, Russia, Germany.
• Increase in Imports: From Saudi Arabia, Singapore, and Korea, suggesting sector-specific demands and evolving sourcing strategies.

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Positive Impacts on the Indian Economy

1. Trade Surplus Benefits

• Strengthens India’s current account position.
• Supports INR stability and foreign exchange reserves.

2. Job Creation

• Export-led growth often fuels manufacturing and services sector employment.
• Greater factory utilization and SME engagement.

3. Strategic Diversification

• The US as a reliable trade ally helps reduce overdependence on volatile regions.
• Enhances India’s resilience during global economic fluctuations.

4. Boost to Foreign Direct Investment (FDI)

• Strong trade relations often attract capital inflows from the partner country.
• Investors favor stable and growing bilateral trade ecosystems.

5. Momentum for Bilateral Trade Agreement

• The current upswing may accelerate the India-US trade pact discussions.
• Eases tariff and non-tariff barriers for Indian exporters.

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Challenges & Considerations

Potential Risk	Impact
Overreliance on US Market	Vulnerability to US domestic policies or economic downturns
Bilateral Trade Deal Complexities	Delays in conclusion may hinder long-term planning
Sectoral Unevenness	Export gains may not offset losses in import-sensitive sectors
Currency Volatility	Affects input costs, inflation, and export competitiveness

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Conclusion

India’s trade surge with the US signals a new phase of economic engagement, driven by rising exports, shrinking imports, and strategic alignment. As talks around a bilateral agreement progress, India stands to gain not just in trade but also in jobs, investment, and global positioning. However, policy agility, diversified markets, and domestic sectoral support remain crucial to sustaining this positive trajectory.