India Defies Global Challenges, Poised to Surpass $1 Trillion in Exports by 2025-26

India is set to surpass $825 billion in exports for 2025-26, despite global challenges like the Russia-Ukraine war. Exports hit a record $825 billion in 2024-25, with projections by FIEO targeting $1 trillion, driven by 12% growth in merchandise and 20% in services. Key sectors such as electronics and textiles will lead the surge. Strategic free trade agreements, including TEPA with EFTA, and business-friendly reforms are boosting foreign investments, positioning India as a resilient global trade leader.

India is demonstrating remarkable resilience in the face of global geopolitical and economic disruptions, with its export sector poised for unprecedented growth. Commerce and Industry Minister Piyush Goyal has expressed confidence that the nation’s export of goods and services will exceed $825 billion in the fiscal year 2025-26, despite challenges posed by global crises such as the Russia-Ukraine war, the Israel-Hamas conflict, and the ongoing Red Sea tensions.

Record-Breaking Export Performance

India’s overall exports reached a historic high of $825 billion in 2024-25, a significant increase from $778 billion in the previous fiscal year. Minister Goyal noted that even as global trade faces contraction, as predicted by various multilateral bodies, India has consistently emerged stronger during turbulent times. “The world is navigating severe geopolitical challenges. Despite this, we achieved record-breaking exports, and we are optimistic about surpassing these figures this year,” Goyal shared with PTI.

Ambitious Projections for 2025-26

The Federation of Indian Export Organisations (FIEO) has forecasted a robust 21% year-on-year growth in India’s exports, projecting a $1 trillion milestone by 2025-26. According to FIEO President S C Ralhan, this surge is driven by an increasing shift among global buyers to diversify their sourcing amid economic uncertainties.

FIEO anticipates merchandise exports to grow by 12%, reaching $525-535 billion in 2025-26, up from $437 billion in 2024-25. Meanwhile, services exports are expected to leap by 20%, climbing to $465-475 billion from $387 billion in the previous fiscal year. Key sectors likely to drive this growth include electronics, engineering, chemicals, textiles, pharmaceuticals, and agriculture.

Trade Agreements Fueling Growth

India’s Free Trade Agreements (FTAs) with nations such as the UAE, Australia, and the European Free Trade Association (EFTA) are expected to provide additional momentum to export growth. The India-EFTA Trade and Economic Partnership Agreement (TEPA), signed on March 10, 2024, is set to take effect on October 1, 2025. This agreement includes an investment commitment of $100 billion over the next 15 years from EFTA nations while facilitating reduced or zero duties on products like Swiss watches, chocolates, and polished diamonds.

In contrast to FTAs signed during previous political administrations, which Goyal criticized for being poorly structured, the current government has adopted a strategic approach. “Earlier FTAs favored competitors and often hurt domestic industries by creating inverted duty structures. Now, under the Modi government, we are focusing on balanced agreements with developed partners to ensure mutual benefits,” Goyal explained.

Ease of Doing Business: A Priority

India’s efforts to attract foreign investment are supported by a strong emphasis on improving the ease of doing business. Minister Goyal highlighted the Modi government’s focus on deregulation, reducing compliance burdens, and decriminalizing business laws to create a more attractive environment for investors. He expressed optimism that the $100 billion investment commitment under TEPA could be exceeded and realized sooner than anticipated.

As global trade continues to grapple with uncertainty, India stands out as a beacon of resilience and growth. With strategic trade partnerships, a focus on key export sectors, and a commitment to fostering a business-friendly environment, the country is well on its way to achieving its ambitious export goals. The coming years mark a promising chapter for India as it solidifies its position as a global trade powerhouse.