According to the Reserve Bank of India, services exports (receipts) reached USD 32.11 billion in June 2025 — a 12.0% increase year‑on‑year, compared to June 2024. Services imports (payments) rose to USD 15.90 billion, an increase of 5.0% on the same basis
Main Drivers of Growth
- The growth was primarily fueled by IT services, business services (including consulting, legal, accounting), and financial services.
- These segments constitute the backbone of India’s services exports and delivered consistent momentum throughout the quarter.
Quarterly Momentum: April–June 2025 (Q1 FY26)
According to the Ministry of Commerce and RBI estimates:
- Services exports in Q1 FY26 totaled USD 98.13 billion, up 10.93% YoY, from USD 88.46 billion in Q1 FY25.
- Services imports were USD 51.18 billion, rising 4.92%, compared to USD 48.78 billion in the prior year.
- The resulting services trade surplus reached USD 46.95 billion, an 18.3% gain over the USD 39.68 billion surplus a year ago
Broader Macro Context & Significance
- Trade Account Impact: The robust services surplus played a major role in offsetting continued merchandise trade deficits. In June alone, services surplus was about USD 15.3–15.6 billion, helping narrow India’s total trade gap to approximately USD 3.5 billion.
- Current Account: Services exports remain a stabilizing force. India posted its first full-year current account surplus in four quarters in Q4 FY25, largely thanks to strong service receipts and record remittances.
What’s Driving It?
- Service activity momentum: The S&P Global/HSBC India Services PMI surged to 60.4 in June — the highest in ten months — indicating elevated growth driven by strong export orders and domestic demand.
- Export orders at record levels: The broader Composite PMI hit 61.0, reflecting the fastest growth in 14 months. New export business was especially strong, supporting overall trade resilience.
- Subdued inflation: Lower input cost pressures helped service providers maintain margins while expanding globally.
Implications & Outlook
Fiscal Year Outlook
- The services sector is emerging as a strategic buffer for India’s external sector. While merchandise trade remains volatile, services exports continue to grow steadily.
- Given this, analysts expect India’s current account deficit to remain manageable, potentially even witnessing comfortable surpluses if the trend persists.
Policy & Economy
- The RBI’s June 2025 rate cut (50 bps reduction), alongside a shift to a neutral policy stance, aims to support service-led growth while keeping inflation in check.
- The softening of credit growth (especially non-food credit decelerating to ~10%) denotes moderation in domestic demand, yet service exporters are thriving abroad.
Summary Table
| Metric (June 2025 vs June 2024) | Value |
|---|---|
| Services Exports (Receipts) | USD 32.11 billion (+12.0%) |
| Services Imports (Payments) | USD 15.90 billion (+5.0%) |
| Service Trade Surplus (approx.) | ~USD 16 billion |
Final Takeaway
June 2025 marked a strong month for India’s services exports, with a double-digit rise affirming continued global competitiveness. While imports backlog also grew modestly, the widening services surplus helped cushion the trade deficit. Services remain India’s strategic strength amid global headwinds, supported by solid demand, favorable policy support, and competitive advantages in digital and professional services.