Foreign trade of India

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Foreign trade in India includes all imports and exports to and from India. At the level of the Central Government, trade is administered by the Ministry of Commerce and Industry.[1] Foreign trade accounted for 48.8% of India's GDP in 2018.[2]

History[edit | edit source]

See also: Economic history of India and Indo-Roman trade relations

Even before independence, the Government of India maintained semi-autonomous diplomatic relations. It had colonies (such as the Aden Settlement), who sent and received full missions,[3] and was a founding member of both the League of Nations[4] and the United Nations.[5] After India gained independence from the United Kingdom in 1947, it soon joined the Commonwealth of Nations and strongly supported independence movements in other colonies, like the Indonesian National Revolution.[6] The partition and various territorial disputes, particularly that over Kashmir, would strain its relations with Pakistan for years to come. During the Cold War, India adopted a foreign policy of non-alignment policy itself with any major power bloc. However, India developed close ties with the Soviet Union and received extensive military support from it.

Around 100CE[edit | edit source]

The Periplus of the Erythraean Sea is a document written by an anonymous sailor from Alexandria around 100 CE, describing trade between countries, including India.

Around 1500[edit | edit source]

In 1498, Portuguese explorer Vasco da Gama landed in Calicut (modern day Kozhikode in Kerala), and was the first European to ever sail to India. The tremendous profit made during this trip made the Portuguese eager for more trade with India and attracted other European navigators and tradesmen.[7]

Pedro Álvares Cabral left for India in 1501 and established Portuguese trading posts in Calicut and Cochin (modern day Kochi), returning to Portugal in 1501 with pepper, ginger, cinnamon, cardamom, nutmeg, mace, and cloves. The profits made from this trip were substantial.[8]

1991 economic reform[edit | edit source]

Main article: Economic liberalisation in India

Prior to the 1991 economic liberalisation, India was a closed economy due to the average tariffs exceeding 200 percent and the extensive quantitative restrictions on imports. Foreign investment was strictly restricted to only allow Indian ownership of businesses. Since the liberalisation, India's economy has improved mainly due to increased foreign trade.[9] Reforms in India in the 1990s and 2000s aimed to increase international competitiveness in various sectors, including auto components, telecommunications, software, pharmaceuticals, biotechnology, research and development, and professional services. These reforms included reducing import tariffs, deregulating markets, and lowering taxes, which led to an increase in foreign investment and high economic growth. From 1992 to 2005, foreign investment increased by 316.9%, and India's GDP grew from $266 billion in 1991 to $2.3 trillion in 2018.[10][11]

Trade in services[edit | edit source]

See also: Business process outsourcing to India and Information technology in India

As of 2023, India is the seventh largest exporter of commercial services in the world,[12] accounting for 4.6% of global trade in services. India's service exports grew by 27%.[13] In September, India's prominent services industry experienced an acceleration in growth, buoyed by robust demand in the sector. A recent survey also indicated that businesses displayed the highest level of optimism in over nine years. According to S&P Global's India services purchasing managers' index, there was an increase to 61.0 last month from August's figure of 60.1. This surpassed projections in a Reuters poll, which had anticipated a slight dip to 59.5.[14][15]

The spectrum of India's services exports encompasses a diverse array of sectors, ranging from information technology (IT)[16] to the provision of medical services by professionals overseas. The RBI, while not providing monthly disaggregated data on services exports, periodically releases a classification of such exports as part of its quarterly balance of payment data. This classification encompasses transport, travel, construction, insurance and pensions, financial services,[17] telecommunications, computer and information services, as well as personal, cultural, recreational services, among other business services.

Within India's services export landscape, software exports retain a dominant position. However, noteworthy is the recent surge in "other business services" exports, which constituted 24 percent of the total services exports in the initial nine months (April–December) of FY23.[18] This marks a notable increase from the 19 percent reported in FY14. This category encompasses a range of services including legal services, accounting, auditing, book-keeping, tax consultancy services, management consulting, managerial and public relations services, as well as advertising, market research, and public opinion polling services.

Exports and imports[edit | edit source]

Main article: List of exports of India

India exports approximately 7500 commodities to about 190 countries, and imports around 6000 commodities from 140 countries.[19]

Pharmaceutical industry[edit | edit source]

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Oil and gas industry[edit | edit source]

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Diamond Processing[edit | edit source]

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Automotive Industry[edit | edit source]

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Trade statistics[edit | edit source]

Overall foreign trade data in billion US$[20]

FY Merchandise Exports Merchandise Imports Total Merchandise Trade Merchandise Trade Balance Service Exports Service Imports Total Service Trade Service Trade Balance Net Overall Trade
2024-25 437.416 720.243 1157.659 -282.827 387.540 198.717 586.257 +188.823 -94.004
2023-24 437.072 678.215 1115.287 -241.143 341.107 178.324 519.431 +162.783 -78.360

Summary table of recent India foreign trade (in billion $):[21][22][23]

Year Export Import Trade Deficit
1999 36.3 50.2 -13.9
2000 43.1 60.8 -17.7
2001 42.5 54.5 -12.0
2002 44.5 53.8 -9.3
2003 48.3 61.6 -13.3
2004 57.24 74.15 -16.91
2005 69.18 89.33 -20.15
2006 76.23 113.1 -36.87
2007 112.0 100.9 11.1
2008 176.4 305.5 -129.1
2009 168.2 274.3 -106.1
2010 201.1 327.0 -125.9
2011 299.4 461.4 -162.0
2012 298.4 500.4 -202.0
2013 313.2 467.5 -154.3
2014 318.2 462.9 -144.7
2015[24] 310.3 447.9 -137.6
2016 262.3 381 -118.7
2017 275.8 384.3 -108.5
2018 303.52 465.58 -162.05
2019 330.07 514.07 -184
2020 314.31 467.19 -158.88
2021 420 612 -192
2022[25] 676.53 760.06 -83.53
2023 770.18 [26] 892.18 -122
2024[27] 820.93 915.19 -94.26

Trading partners of India[edit | edit source]

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See also[edit | edit source]

References[edit | edit source]

  1. ↑ "Country comparison: Exports". The World Factbook. Central Intelligence Agency. Archived from the original on 27 April 2019. Retrieved 5 June 2017.
  2. ↑ "Human Development Report 2018" (PDF). narendhar. Retrieved 21 March 2017.[permanent dead link]
  3. ↑ High Commission of India in Australia: India Australia Relations Archived 13 October 2009 at the Wayback Machine. Hcindia-au.org (20 April 2011). Retrieved 12 November 2011.
  4. ↑ First Assembly, Geneva, 15 November – 18 December 1920 Archived 13 January 2020 at the Wayback Machine. Indiana.edu (18 December 1920). Retrieved 12 November 2011.
  5. ↑ UN list of members by admission Archived 12 July 2014 at the Wayback Machine. Un.org. Retrieved 12 November 2011.
  6. ↑ [1] [dead link]
  7. ↑ John, K. C.; Kevin, S (2004). Traditional Exports of India: Performance and Prospects. Delhi: New Century Publications. p. 59. ISBN 81-7708-062-8.
  8. ↑ John, K. C.; Kevin, S (2004). Traditional Exports of India: Performance and Prospects. Delhi: New Century Publications. p. 59. ISBN 81-7708-062-8.
  9. ↑ "International Economics & Trade - India: Foreign Trade Policy". worldbank.org. 2011. Retrieved 20 October 2011.[dead link]
  10. ↑ Dutta, M. K. and Sarma, Gopal Kumar, Foreign Direct Investment in India Since 1991: Trends, Challenges and Prospects (1 January 2008).
  11. ↑ Mudgill, Amit. "Since 1991, Budget size grew 19 times, economy 9 times; your income 5 times". The Economic Times. Archived from the original on 17 January 2023. Retrieved 29 August 2020.
  12. ↑ "Service exports (BoP, current US$) | Data". data.worldbank.org. Archived from the original on 17 March 2023. Retrieved 17 March 2023.
  13. ↑ "India's services exports rise record 27% in FY23, shows RBI data | IBEF". India Brand Equity Foundation. Archived from the original on 16 November 2023. Retrieved 6 October 2023.
  14. ↑ Chandak, Anant (5 October 2023). "India's services sector grew at faster pace in Sept, optimism at 9-year high". www.msn.com. MSN. Reuters. Archived from the original on 31 March 2024. Retrieved 6 October 2023.
  15. ↑ Bhatia, Ruchi (5 October 2023). "India Services Activity Gains on Solid Demand at Home and Abroad". Bloomberg.com. Archived from the original on 1 January 2024. Retrieved 6 October 2023.
  16. ↑ Majumdar, Romita (31 January 2022). "Economic Survey 2022: IT exports drive 18.4% growth in India's services exports between April-Dec". The Economic Times. Archived from the original on 16 November 2023. Retrieved 6 October 2023.
  17. ↑ "India: value of financial services export by type 2021". Statista. Archived from the original on 16 November 2023. Retrieved 6 October 2023.
  18. ↑ Mishra, Asit Ranjan (2 May 2023). "India's services exports rise record 27% in FY23, shows RBI data". Wayback Machine: Business Standard. Archived from the original on 6 October 2023. Retrieved 6 October 2023.
  19. ↑ Macroeconomics and Elementary Statistics. ISBN 9788187140900.
  20. ↑ "Monitoring dash board". Department of Commerce. Retrieved 9 August 2025.
  21. ↑ "India - Imports - Historical Data Graphs per Year". Archived from the original on 4 March 2016. Retrieved 27 December 2015.
  22. ↑ "The World Factbook". www.cia.gov. Archived from the original on 18 March 2021. Retrieved 27 December 2015.
  23. ↑ "Export Import Data". www.eximatlasindia.com. Archived from the original on 28 October 2017. Retrieved 24 March 2018.
  24. ↑ "Total Trade". commerce.nic.in. Department of Commerce. Archived from the original on 22 November 2018. Retrieved 20 December 2015.
  25. ↑ "India's overall exports projected to scale new heights, growing at 13.84 percent during FY 2022-23 over FY 2021-22 to achieve USD 770.18 billion worth of exports". pib.gov.in. 13 April 2023. Archived from the original on 29 November 2023. Retrieved 7 October 2023.
  26. ↑ Mukherjee, Saurav (13 April 2023). "India's overall trade deficit in FY 22-23 jumps to $122 billion, says govt". mint. Archived from the original on 16 November 2023. Retrieved 7 October 2023.
  27. ↑ "The cumulative exports (merchandise & services) during FY 2024-25 (April-March) is estimated to grow by 5.50% at US$ 820.93 Billion, as compared to US$ 778.13 Billion in FY 2023-24 (April-March)". Press Information Bureau: Government of India. Retrieved 16 April 2025.

External links[edit | edit source]

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