India’s Trade Deficit Surges 141% to $21.8B in Oct 2025 – Key Causes & Solutions

India’s Trade Deficit Surges 141% to $21.8B in Oct 2025 – Key Causes & Solutions

📉 Trade Deficit Spike: Jumped to $21.8B (vs $9.05B YoY) due to falling merchandise exports (↓11.8%) and surging imports — especially gold (+200%) and silver (+530%) during Diwali.

💡 Silver Lining: Services exports rose +11.9% (IT & GCCs strong), helping FY25 exports grow +4.8% overall (Apr–Oct).

⚠️ Key Drivers:

• U.S. Tariffs: 50% duties hit exports — ↓20.4% to U.S. in Sept
• Weak Demand: Gems & jewellery (↓29.5%), leather (↓15.7%)
• Rupee Hedge: Gold demand rebounded as currency hedge

✅ Way Forward:
🔹 Resolve U.S. tariffs via BTA talks
🔹 Diversify to ASEAN, Africa, LatAm (use TIES Scheme for infra support)
🔹 Boost RoDTEP for leather/textiles
🔹 Moderate gold imports (e.g., Turkey-style quota model)