China has displaced the US to become India’s largest trading partner in 2025–26, ending Washington’s four-year run in the top spot through 2024–25. Bilateral trade between India and China rose to USD 151.1 billion, according to government data cited by the Economic Times.
However, India’s trade deficit with China widened significantly, reaching USD 112.16 billion during the period. Exports to China jumped 36.66% to USD 19.47 billion in the last fiscal year, while imports increased 16% to USD 131.63 billion. As a result, the trade gap hit a record USD 112.6 billion in 2025–26, up from USD 99.2 billion in 2024–25.
By contrast, India’s trade dynamics with the US were more subdued. Exports to the US inched up 0.92% to USD 87.3 billion in the last fiscal year, while imports from the US rose 15.95% to USD 52.9 billion. Consequently, India’s trade surplus with the US narrowed to USD 34.4 billion in 2025–26, from USD 40.89 billion in 2024–25.
