India’s merchandise exports to China have recorded a double-digit monthly growth thus far in 2025-26, cumulatively growing by 20% to $5.76 billion in the first four months of the financial year compared to $4.80 billion in the same period in 2024-25, driven by energy, electronics, and agricultural products, and raising hopes that this could help offset some of the losses arising from US tariffs.
India‘s exports to China in the first four months of 2025-26 have grown at an annualized rate of 19.97% compared to a 4.5% year-on-year contraction in the same period last year (April-July 2024), according to government data.
If this trend continues, India will witness a positive growth in exports to China this financial year (2025-26), people familiar with the matter said, requesting anonymity. In 2024-25, Indian merchandise exports to China contracted by 14.5% to $14.25 billion as compared to $16.67 billion in 2023-24.
Out of 12 months in 2024-25, Indian exports to China contracted in 11 , barring May 2024. In contrast to FY25, a consistent upward trend in exports to China has been witnessed in the current financial year (FY26) , from April itself, they added citing data.
In April, they grew 12.9% (over last April) to $1.4 billion; in May, they rose by 24% to $1.63 billion; in June, they grew 17% to $1.38 billion; and in July, they rose 27% to $1.35 billion.
This trend is likely to strengthen further with recent positive engagements between the two countries, the people mentioned above said.
India and China agreed to enhance bilateral trade relations during Chinese foreign minister Wang Yi’s New Delhi visit earlier this week. According to the official statement issued by the ministry of external affairs on August 19, both sides agreed to the re-opening of border trade through the three designated trading points — Lipulekh Pass, Shipki La Pass and Nathu La Pass. They also agreed to facilitate trade and investment flows between the two countries “through concrete measures”.
“The two [countries] are keen to boost bilateral economic relations amid global trade uncertainties triggered by the US,” one of them said. Granular analysis of data showed that demand for Indian petroleum products, agricultural goods and marine items have immense potential in the world’s second biggest market after the US, he added.
A second official said the “ rise underscores the strengthening demand for Indian goods in the Chinese market and highlights India’s growing export competitiveness despite global trade uncertainties. The steady growth in exports also signals a gradual rebalancing of trade between the two Asian economies, where India has traditionally faced a large trade deficit.”
In 2024-25, India had a $99.2 billion trade deficit with China.
“This upswing is a promising development that could help India diversify its export base and consolidate its presence in one of the world’s largest import markets,” a trade expert said, requesting anonymity..
India’s export growth to China in the first quarter of FY25 was powered by a strong performance across energy, electronics, and agri-based products, according to official data. Exports of petroleum products nearly doubled to $883 million (95.3%), while those of electronic goods surged to $521 million (202.7% growth), reflecting strong demand from China’s industrial and consumer segments. Agricultural commodities recorded extraordinary growth, with oil meals exports aggregating $41.7 million (2656.1% growth), rice, $32.2 million (1383.3%), and oil seeds $16 million (1791.7%).
Traditional sectors also added to the momentum — exports of organic and inorganic chemicals reached $335.1 million (16.3%), spices $234.5 million (21.9%), tea $8.9 million (93.9%), and gems and jewellery $11.5 million (72.7%). Moderate gains were recorded in marine products (5.1%), mica, coal and ores (3.0%), and ready-made garments (14.8%).