India's October 2025 export data reveals a paradox: electronics surged 19%, driven by smartphones, while most other
major categories shrank. Aggressive Chinese competition and tariff pressures are squeezing India's export potential,
with traditional markets increasingly dominated by Chinese goods, necessitating targeted interventions to revive key
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India’s October 2025 export data presents a paradox.
On the surface, electronics exports surged 19%, led by a robust $2.4 billion in smartphone shipments. Yet, a deeper look
reveals something that may be of concern. Most other major export categories shrank sharply, and several of India’s key
markets are increasingly dominated by Chinese goods.
Experts warn that this combination of tariff pressures and aggressive Chinese competition is squeezing India’s export
Electronics appears to be the lone bright spot. Smartphones alone contributed 60% of the sector’s total, with Apple
iPhones accounting for $1.6 billion in October. But experts caution that this growth is relative, not absolute.
Indeed, the numbers confirm that India’s growth in electronics masks declines across the board.
Also Read: Electronics the only bright spot for exports amid a dull October
Declines across major sectors
India’s merchandise exports took a hit in October 2025, with most major sectors recording declines -- a scenario not
The Ministry of Commerce & Industry data shows that for the first time in a long while, India’s top ten export
categories collectively shrank, highlighting both global and domestic pressures on the trade front.
Engineering goods, the backbone of India’s export portfolio, dropped 16.7%, from $11.25 billion last October to $9.37
billion. Petroleum products fell 10.5% to $3.95 billion, and drugs and pharmaceuticals saw a modest 5.2% decline to
The steepest hit came in gems and jewellery, which tumbled 29.5% to $2.29 billion, followed by organic and inorganic
chemicals, down 21% to $2.14 billion. Textiles, a sector crucial for jobs and rural incomes, also suffered. Ready-made
garments contracted 12.9%, cotton yarn and handloom products dropped 13.3%, while rice exports fell 16.5%. Even plastic
and linoleum products were not spared, down 21.6%.
The only bright spot was electronics, which grew 19.05% to $4.08 billion.
Taken together, the top ten export categories slid from $31.8 billion in October 2024 to $27.8 billion, marking a 12.6%
Merchandise exports overall fell from $38.98 billion to $34.38 billion, while total exports including services dipped
slightly to $72.89 billion.
As per ET, analysts suggest multiple factors are at play. US tariffs imposed in August 2025, which slapped a 50% duty on
Indian imports in phases, have hit key sectors. Combined with global demand slowdowns and logistical challenges,
October’s numbers reflect a perfect storm for exporters.
What this means is that while electronics continue to offer a glimmer of hope, the broader story is clear -- India’s
export engines are sputtering, and policymakers may need targeted interventions to revive traditional sectors.
China’s strategic advantage
While India’s shipments to the United States had already softened in September, exports to other significant markets --
including the UAE, Italy, the UK, Germany, Australia, South Africa, Brazil, and South Korea -- also contracted.
As per CNN, analysts point to China’s persistent export strategy as a central factor. Chinese firms have increasingly
flooded global markets with products priced below cost -- a practice commonly described as “dumping.”
Tariff shifts tilt the playing field
This aggressive pricing undermines Indian competitiveness, raising questions about the sustainability of India’s market
In the electronics sector, for example, the recent halving of US fentanyl tariffs on Chinese goods, from 20% to 10%,
risks eroding India’s relative advantage.
While electronics themselves are exempt, related components remain subject to tariffs, meaning the policy shift could
indirectly benefit Chinese exporters at India’s expense.
Without targeted support measures, India’s hard-won export gains could be imperiled.
A direct month-on-month comparison with China paints a stark picture.
The data shows that India is losing ground across its traditional markets, while China continues to expand, particularly
in Europe, Australia, and Africa.
Simultaneously, China’s dependence on the US market is diminishing, with exports falling nearly 18% year-on-year in
October, a signal of deliberate diversification, as reported by CNN.
China’s strategy is regionally nuanced. In Southeast Asia, growth is driven by machine tools, automobile components, and
computer parts; Africa sees rising exports of construction machinery and green technologies; Latin America increasingly
imports Chinese electric vehicles, fertilisers, and electronics.
While this demonstrates Beijing’s resilience, it also raises concerns about the long-term impact on domestic industries
in importing countries, CNN analysts point out.
The global response is growing. The US, India, Mexico, and Brazil together launched 79 anti-dumping and countervailing
investigations against Chinese goods in the first half of 2025, signaling heightened vigilance, according to World Trade
According to the same report, analysts caution that without corresponding local investment or technology transfer,
countries risk “deindustrialisation,” a phenomenon already observed in parts of Latin America.
“For some Latin American countries, ‘deindustrialization is a big problem when Chinese companies start to invest …
because they bring just the assembly, they don’t do technology and knowledge transfer,’” Diego Rodriguez, logistics and
industrial practice leader at Americas Market Intelligence, a research firm in Miami, told CNN, noting that countries
such as Brazil are actively pushing back against this trend.
China, however, frames its position differently. Officials emphasise openness and reliability, portraying the country as
a stable trading partner while promoting its domestic market to global investors.
The reality, though, is reflected in trade imbalances. Germany, for example, is projected to record a trade deficit of
87 billion euros with China in 2025, surpassing the previous record of 2022, according to a forecast by state-owned
international economic promotion agency Germany Trade & Invest (GTAI) seen by Reuters.
Shifting trade dynamics also reshape partnerships. Germany, which had lost its position as China’s largest trading
partner to the US in 2024, saw China reclaim the top spot in early 2025.
Yet German policymakers are diversifying supply chains for strategic products such as semiconductors and rare earths to
reduce exposure to geopolitical and trade risks.
For India, the implications are clear and urgent. China’s strategic export approach, combining aggressive pricing,
market diversification, and tariff management, is redefining global trade patterns.
India’s declining exports to key markets, particularly Europe and Australia, highlight the need for targeted policy
interventions, sectoral support, and proactive market engagement.
Electronics -- temporary shield
Electronics growth remains promising. For April–October 2025, the sector grew 37.82% to $26.28B, narrowing the gap with
petroleum exports from $21.99B to $8.08B. This success is largely due to favorable conditions: electronics are currently
exempt from US tariffs, while other Chinese goods are still subject to reduced levies. Electronics exports were
nonetheless up in October primarily due to the massive $2.4 billion smartphone exports which contributed 60% in the
Smartphone exports were down marginally in August and September relative to other months of the year due to high
domestic demand, particularly during the festive season.
But even during these months, exports were up as compared to last year, keeping the growth momentum sustained. In
September, smartphone exports were up a record 100% compared with the same month last year.
Apple's iPhone exports of $1.6 billion contributed a third to the total smartphone exports and 40% to total electronics
For the April-October period, electronics was the fastest growing category, as exports increased 37.82% to $26.28
billion as against $19.07 billion in the same period last year.
For the first seven months of this fiscal, the gap between electronics and petroleum, the third- and second-ranked
export categories, narrowed to $8.08 billion from $21.99 billion a year earlier.
If this trend continues and smartphone exports grow at the same pace, electronics is expected to replace petroleum as
India's second largest export basket in the coming couple of years.
India’s October 2025 export performance shows that relative growth in one sector cannot offset structural weaknesses
across multiple categories. China’s strategic expansion into markets that India traditionally served is squeezing Indian
India cannot rely on electronics alone to drive exports. A multi-pronged strategy is needed to protect traditional
sectors, diversify markets, and enhance competitiveness against China’s growing footprint.
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