Gold Surge Pushes India’s October Trade Deficit to $41.68 Billion as Exports Decline

Mumbai | November 19
India’s trade deficit widened sharply in October 2025, rising to $41.68 billion, driven by a surge in gold imports and a significant drop in merchandise exports, according to the Commerce Ministry’s latest trade data. The widening gap highlights renewed pressure on India’s external sector as global demand continues to soften.

India’s merchandise exports fell 11.8% to $34.38 billion, while imports increased 16.63% to $76.06 billion, marking one of the largest monthly divergences in FY26.

Gold Imports Jump 199% and Drive Overall Import Spike

A dramatic rise in gold imports was the biggest contributor to October’s widening deficit.
Inbound shipments of gold surged 199.2% year-on-year to $14.72 billion, compared with $4.92 billion last October. The jump reflects a combination of festive-season demand, attractive global prices and restocking by jewellers.

Silver imports also climbed, adding to the increase in overall non-oil imports.
Non-petroleum, non-gems & jewellery imports rose to $42.78 billion, up from $39.58 billion in October 2024.

Exports to the US Fall; Weak Global Markets Hit Outbound Trade

India’s shipments to its largest export destination, the United States, slipped to $6.3 billion, down from $6.9 billion a year earlier. The drop reflects continued weakness in global trade and pressure on key sectors such as engineering goods, textiles and chemicals.

Commerce Secretary Rajesh Agrawal said the challenging global environment continues to weigh on outbound shipments: “Overall exports (merchandise and services) for the first seven months of the fiscal have grown 4.84%, but merchandise growth remains limited at 0.63% despite global turmoil,” he noted.

Non-petroleum, non-gems & jewellery exports also fell to $28.14 billion, compared with $31.32 billion in October 2024.

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Services Exports Continue to Support the Trade Balance

While merchandise exports weakened, services exports remain a bright spot.
Services exports for October 2025 are estimated to rise to $38.52 billion, up from $34.41 billion a year ago. Services imports are projected to increase to $18.64 billion, compared to $17.23 billion last October.

The ongoing strength in IT services, consulting, engineering solutions and digital operations is helping offset merchandise volatility.

Gold Price Today: Domestic Bullion Gains Ahead of US Fed Minutes

Domestic gold and silver prices rose on Wednesday, mirroring international cues and rising spot demand.

• MCX Gold December Futures: ₹1,22,884 per 10g (+0.20%)
• MCX Silver December Futures: ₹1,55,337 per kg (+0.45%)

The market now awaits the release of the US Federal Reserve’s meeting minutes.
The Fed cut interest rates by 25 bps in October to 3.75%–4.00%, and investors expect another rate cut in December, though much will depend on upcoming US labour market data.

Macro Outlook

The steep widening of India’s October trade deficit underscores the challenge of balancing import-led domestic demand with slowing global growth.
While festive-season gold inflows are expected to normalise, policymakers are watching for signs of stability in export markets and commodity prices.

India’s strong services exports and resilient consumption provide some cushioning, but the next few months will be critical as global economic conditions shift.

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