India’s commerce flows have remained resilient by the primary half of FY26 at the same time as international uncertainty, foreign money volatility and shifting tariff regimes examined exporters, SBI Analysis mentioned in its newest evaluation. Merchandise exports rose 2.9 per cent to USD 220 billion between April and September, up from USD 214 billion a 12 months earlier, signalling regular demand throughout key markets.
Is the US slowdown weighing on India’s shipments?
The report famous that India’s exports to america grew 13 per cent to USD 45 billion throughout the six-month interval, although September posted a pointy 12 per cent year-on-year decline. The US continues to be a significant purchaser, however its share in India’s complete exports has slipped since July, dropping to fifteen per cent in September.
Marine merchandise, ready-made cotton clothes and valuable stones confirmed blended developments. The share of the US in India’s marine exports fell to fifteen per cent in September from 20 per cent final 12 months, whereas its share in valuable stones dropped to six per cent from 37 per cent. Nonetheless, marine merchandise and cotton clothes nonetheless posted constructive progress within the April–September interval.
Export basket diversifies as new markets develop
SBI Analysis mentioned India’s export locations have broadened meaningfully. Markets such because the UAE, China, Vietnam, Japan, Hong Kong, Bangladesh, Sri Lanka and Nigeria recorded larger shares throughout a number of product strains.
The report prompt that this will mirror oblique routing of Indian items as a number of international locations seem like re-exporting to the US. Australia’s share in US imports of valuable stones, as an example, has risen from 2 per cent to 9 per cent this 12 months, whereas Hong Kong’s share has edged up from 1 per cent to 2 per cent.
Tariff challenges drive coverage assist
The evaluation comes as India navigates the Trump administration’s tariff regime, which has imposed the very best duties on Indian items amongst Asian exporters. Sectors similar to textiles, jewelry and seafood – particularly shrimp have taken a success.
In response, New Delhi has cleared Rs 45,060 crore in assist measures for exporters, together with Rs 20,000 crore in credit score ensures, aimed toward enhancing competitiveness and rushing up market diversification.
Rupee weakens however outlook seen secure
The rupee slipped previous 89.49 in opposition to the US greenback on Friday after weeks of relative stability. The autumn was attributed largely to international risk-off sentiment, a selloff in digital property and the “Promote Japan” pattern dragging broader Asian currencies.
The Reserve Financial institution of India has maintained it is not going to defend any particular rupee degree. SBI Analysis mentioned the most recent drop seems to be a short-term adjustment and never an indication of underlying weak spot.
CAD anticipated to widen earlier than enhancing
India’s present account deficit stood at 0.2 per cent of GDP in Q1 FY26, enhancing from 0.9 per cent a 12 months earlier on the again of sturdy providers exports and remittances. The deficit might widen modestly over the following two quarters earlier than turning constructive by year-end.
SBI Analysis expects India to shut FY26 with a full-year CAD of 1.0–1.3 per cent of GDP and a balance-of-payments shortfall of as much as USD 10 billion, solely marginally larger than final 12 months.
