India's Export Orders Skyrocket Amid Tariff Pause

April saw an unprecedented surge in India's new export orders due to a 90-day tariff pause by the Trump administration. This led to increased output, employment, and a record rise in orders since 2014. Gains were fueled by high global demand and rupee depreciation, enhancing international competitiveness.

The month of April marked a remarkable increase in India's new export orders, thanks to a crucial 90-day hiatus on tariff implementation by the Trump administration, as reported by HSBC Flash India PMI. The Indian private sector witnessed a significant upturn in new business at the dawn of the 2025-26 fiscal year, primarily buoyed by a surge in international demand for both goods and services.

According to the survey participants, new export orders escalated at the swiftest rate since the inception of the series in September 2014. Results from the HSBC 'flash' PMI® also indicated expedited growth in both aggregate output and employment. While cost pressures paralleled those of March, selling prices climbed at a more accelerated pace.

From an index reading of 59.5 in March to 60.0 in April, the HSBC Flash India Composite Output Index demonstrates the most rapid expansion rate since August 2024. Pranjul Bhandari, Chief India Economist at HSBC, highlighted the sharp acceleration in export orders, likely stimulated by the tariff suspension. Consequently, there was a substantial rise in output and employment across manufacturing and services sectors. Despite stable cost inflation, marginal price hikes improved profit margins.

Firms in India's private sector reported scaling output in response to efficiencies, favorable demand trends, and strategic advertising efforts. Currency depreciation also played a role in enhancing international competitiveness, according to some panelists.

A record surge in new export orders occurred in April, driven by robust demand from regions including Africa, Asia, Europe, the Middle East, and the Americas. Goods producers experienced a notably stronger expansion rate than service providers, marking the most significant increase in over 15 years. Overall, aggregate sales skyrocketed at the swiftest pace since August 2024, with manufacturing leading the uptrend over services businesses.

(With inputs from agencies.)