NITI Aayog Unveils 4th Trade Watch Quarterly

India’s trade landscape in early 2025 shows steady growth amid shifting global demand. The latest Trade Watch Quarterly report for Q4 FY 2024-25 marks key trends in merchandise and services trade. It stresses the urgency for India to diversify exports and strengthen competitiveness in emerging sectors. The leather and footwear industry, employment generator, faces changing global preferences that demand innovation and sustainability.

Overall Trade Performance in Q4 FY 2024-25

India’s total trade reached $441 billion, growing 2.2% year-on-year. Merchandise exports contracted slightly due to lower shipments of mineral fuels and organic chemicals. However, electrical machinery, pharmaceuticals, and cereals exports showed robust growth. Imports edged up, driven by demand for nuclear reactors, electrical machinery, and inorganic chemicals. This steady performance reflects resilience amid global uncertainties.

Regional Export and Import Trends

North America emerged as the fastest-growing export market, rising 25% and accounting for 25% of India’s exports. Exports to the European Union, Gulf Cooperation Council, and ASEAN countries moderated. On imports, the United Arab Emirates surpassed Russia as India’s second-largest supplier. This shift was influenced by gold inflows under the Comprehensive Economic Partnership Agreement. Imports from China increased sharply, mainly for electronics.

Leather and Footwear Sector Analysis

The leather and footwear sector employs 4.4 million people and contributes to exports. India holds a 1.8% share in the $296 billion global market. It remains competitive in processed leather and niche apparel segments. However, global demand is moving towards non-leather and sustainable products. The sector must enhance competitiveness through MSME support, research and development, and alignment with green and design-driven value chains.

Strategic Imperatives for Trade Diversification

India’s trade resilience is supported by services exports, aerospace, and high-value manufacturing. Rapid adaptation to evolving demand patterns is crucial. Diversifying the export base and improving competitiveness in non-leather footwear and global value chains are key priorities. Monitoring geopolitical developments is essential to navigate trade risks and seize new opportunities.