♦ China emerged as India’s third-largest export destination in February 2026, overtaking the Netherlands. Exports to China rose sharply by 32.4% year-on-year to $1.67 billion, supported by stronger demand in segments such as electronics and marine products. However, the surge in exports was accompanied by a parallel rise in imports from China, which climbed 30.5% to $11.95 billion, widening India’s trade deficit with its largest trading partner.

♦ In fact, India’s trade deficit with China crossed the $100 billion mark during April–February of the current financial year, underscoring the structural imbalance in bilateral trade despite improved export performance.

♦ Meanwhile, exports to the United States, India’s largest market, continued their downward trajectory. Shipments fell 12.88% year-on-year in February to $6.88 billion, extending a decline that began in September. The drop comes amid tariff volatility, with US duties previously as high as 50% before being reduced to 10% from February 24 for a temporary 150-day period.a