The problem with Indian exports has been that most of them pre-suppose higher imports too. For instance, mobile exports mean higher electronic input imports. Refined product exports mean higher crude imports. That is a rather thankless situation. What India needs at this hour is focus on exports that do not pressure the import bill. Setting up electronics supply chain locally or expanding crude output is not going to happen overnight. To bridge that gap, India needs to rely more on exports like textiles, chemicals, and other products where the import content is low. That planning has to start now! 

The problem with importing too much gold is that you end up using precious forex reserves to pay for an unproductive asset. In October 2025, imports of gold were $14.5 billion. That is almost as high as the crude import bill and that is just not acceptable. Most of the gold imports go into jewellery or for hoarding a safe haven asset. In both cases, the obsession is uncalled for and it is high time, the government places restrictions on the free import of gold. One can argue about its side effects, but the fact is that India cannot have gold driving its merchandise trade deficit higher each month. 

Over the last 3 years, India did the right thing by relying on Russian oil imports. The Urals discount may have narrowed, but Russian oil is still much more economical for India. In the last few months, India has come under pressure from the US on account of the steep tariffs on Indian exports to the US for importing oil from Russia. India’s argument that energy security comes first, is the right stand. If the US can hobnob with Pakistan openly, they have no business to tell India whether to buy Russian oil or not. It remains to be seen how India handles the delicate diplomacy, but if Russian oil is significantly cheaper, there is no reason for India not to buy from Russia. Crude costs have to be kept low. 

There has been a lot written about how the service exports have grown and the services surplus helped reduce the overall deficit. However, services exports are still largely IT exports. Yes, India does have other export sources like Global Competency Centres, Audit, accounting, and legal outsourcing, CDMO etc. However, all these are still very small compared to IT exports. If the new Outsourcing Bill is passed in the US Senate, Indian IT may have a big challenge as more US companies will prefer to rely on local companies to avoid the 25% penal tax. It is time India has a Plan-B on merchandise and service exports; but the bigger challenge is to keep imports in check!