India’s external trade sector has achieved a historic milestone, with total exports reaching an all-time high of US$824.9 billion in the financial year 2024–25, according to the latest data from the Reserve Bank of India (RBI) on services trade for March 2025. This represents a robust 6.01% growth over the previous year’s figure of US$778.1 billion, underscoring India’s resilience amid global economic challenges.
Services Exports: The Growth Engine
The services sector emerged as a key driver of this growth, with exports surging to a record US$387.5 billion in FY 2024–25, a remarkable 13.6% increase from US$341.1 billion in FY 2023–24. In March 2025 alone, services exports reached US$35.6 billion, reflecting an impressive year-on-year growth of 18.6% compared to US$30.0 billion in March 2024. Sectors such as IT, business services, and financial services continue to bolster India’s global competitiveness.
“Services exports reached a historic high of US$387.5 billion in 2024–25, up 13.6% from the previous year, powering India’s record-breaking export performance.”
Merchandise Exports: Strong Non-Petroleum Growth
Merchandise exports, particularly non-petroleum products, also contributed significantly to the record figures. In FY 2024–25, non-petroleum merchandise exports rose to a record US$374.1 billion, marking a 6.0% increase from US$352.9 billion in FY 2023–24. This growth highlights the strength of sectors such as engineering goods, pharmaceuticals, and electronics, despite global headwinds like rising tariffs and geopolitical tensions.
Key Factors Behind the Success
India’s export growth reflects a combination of strategic policy measures and sectoral resilience:
- Services Sector Dominance: The IT and IT-enabled services (ITeS) sector, along with business and financial services, continues to attract global demand, with exports to major markets like the USA, Europe, and the UK.
- Diversified Merchandise Exports: Growth in non-petroleum exports, driven by engineering goods (US$116.7 billion in FY 2024–25) and pharmaceuticals, showcases India’s manufacturing capabilities.
- Policy Support: Government initiatives, including trade agreements and export promotion schemes like the Software Technology Parks (STP) scheme, have facilitated market access and competitiveness.
- Global Market Penetration: India’s exports grew in 115 out of 238 destinations in FY 2023–24, with strong performance in markets like the USA, UAE, and Netherlands.
Challenges and Future Outlook
Despite this stellar performance, challenges loom on the horizon. The recent hike in US tariffs, announced by President Donald Trump, is projected to reduce India’s merchandise exports to the US by US$5.76 billion in 2025, impacting sectors like electronics, seafood, and gold. However, ongoing negotiations for a bilateral trade agreement with the US, expected to conclude by Fall 2025, could mitigate some of these losses.
The Commerce Ministry’s earlier estimate of US$820.93 billion in total exports for FY 2024–25, based on extrapolated services data, has been surpassed with the RBI’s final figures, highlighting the accuracy of India’s trade projections. Looking ahead, the government aims to sustain this momentum by exploring new markets, enhancing infrastructure, and addressing global trade dynamics.
India’s record-breaking export performance in FY 2024–25 is a testament to its growing economic prowess and strategic focus on diversification.
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