Exports

India is set to unveil an upgraded production-linked incentive (PLI) scheme aimed at boosting mobile phone exports, with an estimated outlay exceeding Rs. 46,000 crore (over USD 5 billion). The proposed initiative, expected to be rolled out by May, builds on the earlier Scheme for Large Scale Electronics Manufacturing (LSEM) launched in 2020. With a sharper focus on export competitiveness, the new framework seeks to strengthen India’s position in global electronics supply chains.

India has achieved a historic milestone in its external trade performance, with total exports of goods and services surpassing Rs. 71 lakh crore (USD 860 billion) in the financial year 2025–26. The record reflects a steady rise from Rs. 68.5 lakh crore (USD 825 billion) in the previous fiscal, underscoring the country’s growing integration into global supply chains. 

India’s trade with the Middle East witnessed a sharp contraction in March, with exports falling nearly 58 percent and imports declining over 51 percent, following escalating geopolitical tensions in the region. The disruption stems from a military escalation involving the United States and Israel targeting Iran, which has temporarily affected operations along the critical Strait of Hormuz. As a vital maritime corridor for India’s energy imports and export shipments, the disruption has significantly impacted trade volumes.

India has achieved a significant milestone in its logistics sector, with costs dropping to 9 per cent of GDP, according to Union Minister Nitin Gadkari. This decline, driven by the rapid expansion of expressways and economic corridors, marks a substantial improvement from the previous 16 per cent. A joint study by IIT Chennai, IIT Kanpur, and IIM Bangalore highlighted that enhanced infrastructure and streamlined freight networks are key contributors to this reduction.

India’s export sector continues to demonstrate resilience despite escalating geopolitical tensions, particularly in West Asia. However, policymakers caution that prolonged instability could disrupt trade flows, supply chains, and energy imports, potentially impacting overall export performance. With nearly 12–13 per cent of India’s exports directed toward West Asia, the region’s volatility poses a tangible risk. Government officials emphasize the need for diversification, strategic planning, and supply chain recalibration to mitigate adverse effects.

India’s export sector has demonstrated notable resilience in FY26, maintaining growth momentum despite mounting global uncertainties, including geopolitical conflicts and trade disruptions. A senior government official indicated that the country is likely to end the fiscal year with positive export growth, supported by sustained demand and diversified trade strategies. Challenges such as evolving US tariff dynamics and ongoing international conflicts have tested global trade flows, yet India’s merchandise exports have remained stable.

India’s iconic motorcycle manufacturer Royal Enfield reported a robust 11 percent year-on-year increase in retail sales for March, driven primarily by strong domestic demand. While exports experienced a modest decline during the month, the company closed the financial year on a high note with a 23 percent surge in total sales. The performance highlights resilient consumer appetite in the domestic market, supported by brand strength and expanding product appeal.

India has authorized the export of key essential commodities to the Maldives for the financial year 2026–27 under a bilateral trade arrangement, ensuring stable supply chains for the island nation. The permitted exports include food staples such as rice, wheat flour, sugar, eggs, onions, and potatoes, along with construction materials like stone aggregates and river sand. These shipments will remain exempt from existing or future export restrictions, reflecting India’s commitment to regional cooperation.

India’s ambitious production-linked incentive (PLI) scheme for mobile manufacturing has delivered outcomes well beyond expectations, signaling a structural transformation in the country’s electronics sector. With investments reaching Rs 17,519 crore—more than double initial targets—and production crossing Rs 8.12 lakh crore, the program has catalyzed large-scale industrial growth. Smartphone exports alone touched Rs 2.62 lakh crore in 2025, positioning the country as a net exporter rather than an importer.

Escalating geopolitical tensions in West Asia are significantly disrupting export operations from eastern India, with freight costs surging by up to 80 percent and shipment volumes dropping sharply. Exporters are grappling with container shortages, rerouted shipping lines, and heightened war-risk surcharges, particularly affecting cargo bound for Europe and the United States. Ports such as Kolkata are witnessing congestion, with hundreds of containers stranded amid logistical uncertainty.