India’s exports to the United States jumped 22 per cent in November, reversing declines seen in September and October and making it one of the strongest months on record. This surge came despite steep US tariffs of up to 50 per cent, which have rendered several Indian products less competitive. While exporters have shown resilience, trade data suggest the spike may be driven by temporary factors, underscoring the need for a formal trade agreement to ensure sustained momentum.
Export growth in November was not limited to the US. Shipments also increased sharply to China, Hong Kong and multiple European destinations, pointing to a broader diversification of markets. Indian exporters appear to have benefited from rising geopolitical frictions in East Asia, particularly between China and Japan. With Beijing tightening curbs on imports from Japan, Indian seafood exports to China rose dramatically. Overall exports to China surged 90 per cent in November, while shipments to Hong Kong climbed 35 per cent.
Exports to Europe also picked up ahead of the rollout of the Carbon Border Adjustment Mechanism (CBAM) from January 1, which will raise duties on Indian engineering goods. Anticipating higher costs, European buyers seem to have front-loaded orders. Engineering exports grew 30 per cent overall, with shipments to Germany up 25 per cent, to Spain soaring 180 per cent, and to Belgium rising 30 per cent.
Exporters absorbing tariff pressure in the US
A key factor behind the rise in exports to the US is exporters’ willingness to absorb tariff-related costs in the hope of an imminent trade deal. Many are maintaining their presence in the American market while anticipating an initial agreement under which the US would roll back 25 per cent tariffs. Expectations of a deal have been fuelled by India increasing crude oil imports from the US, committing to source 10 per cent of its LPG requirements from American suppliers, and signalling openness to reforms in the nuclear sector—long-standing US demands.
However, exporters warn that the outlook is weakening. Fresh orders have slowed, and most existing orders are expected to be completed by December. Over the longer term, this could hurt India’s export position, as rival suppliers such as Vietnam and Bangladesh are reportedly attracting business diverted from India. Apparel exporters in Tiruppur, for example, say they have lost winter orders worth nearly ₹7,000 crore from the US, a setback that could have lasting consequences for the cluster.
Low base and Red Sea disruptions
The nearly 20 per cent rise in cumulative goods exports in November also reflects a low base effect. In November last year, export costs escalated sharply due to the Red Sea crisis that began in October 2024. Attacks by Houthi rebels disrupted shipping through the region, causing container shortages and forcing vessels to reroute via the Cape of Good Hope, significantly raising freight costs.
Although major shipping lines continue to avoid the Red Sea route, ceasefire arrangements in Gaza have raised hopes of fewer attacks. The Suez Canal Authority had indicated that Maersk vessels would begin limited transits from early December, with a full resumption later. However, Maersk has yet to confirm a timeline, according to reports.
Electronics and engineering drive export growth
Categories exempt from US tariffs, including electronics and pharmaceuticals, recorded strong growth of 38 per cent and 20 per cent respectively. These segments likely played a major role in boosting exports to the US in November and are expected to remain growth drivers. The US has also expanded its list of exempt items to include products such as tea, coffee and spices, leading to robust growth across these food categories.
Engineering goods exports, India’s largest export segment, also showed signs of stabilisation, expanding by over 30 per cent in November. This aligns with the recent surge in shipments to European markets.
Weaker rupee supports exporters
The export uptick was further supported by a sharp depreciation of the rupee against the US dollar. The currency breached the 90-per-dollar level earlier in December, improving the price competitiveness of Indian goods overseas. In November, the rupee was 5.6 per cent weaker compared to the same month last year, even as the US dollar itself had softened by nearly 8 per cent over the past year.