FX.co ★ India Trade Gap Widens More than Expected

India’s merchandise trade deficit widened to $30.43 billion in June 2026 from $19.12 billion a year earlier, exceeding market expectations of a $26.5 billion shortfall. It was the deepest deficit since January and the largest ever recorded for the month of June. Imports jumped 31% to $70.84 billion, also a record high for June, as the war in the Middle East and US tariffs designed to curb India’s purchases of Russian oil pushed up the cost of imported energy. This surge in imports occurred despite persistent downward pressure on the Indian rupee, which would normally restrain the volume of foreign purchases. By contrast, exports grew at a more moderate pace, rising 15.5% to $40.4 billion. Shipments to the United States were likely robust, as businesses moved to front-load orders ahead of the expiration in July of the current US–India trade agreement, which could expose domestic manufacturers to higher tariffs.