Surging Trade at a 61% Growth Pace
India’s merchandise trade with the Group of Seven (G7) nations skyrocketed from USD 154 billion in FY 2020-21 to USD 248 billion in FY 2024-25, a sharp 61 percent surge, according to a recent study by the PHD Chamber of Commerce and Industry. This vigorous expansion reflects an elevated compound annual growth rate of roughly 13 percent, underpinning India’s rising prominence as a vital trade partner for the world’s leading economies.
$28 Billion Surplus, Smartphones & Pharma at the Core
In FY 2024-25, India posted a robust USD 28 billion trade surplus with the G7, exporting USD 138 billion while importing USD 110 billion. The bulk of exports were driven by smartphones, telecom equipment, and pharmaceuticals, mobile handset shipments to the bloc surged 55% year-on-year to USD 24 billion alone. Indian pharmaceutical firms continue to dominate, meeting over 40 percent of U.S. generic demand and 25 percent of U.K. medicine consumption.
Shifting Trade Shares: Exports Up, Imports Down
Over the past five years, India’s export share to G7 countries rose from 29% to 31%, while imports declined from 18% to 15%, signalling an enhanced position in global trade. This positive trend highlights India’s increasing competitiveness in global markets and its ability to secure favourable trade balances.
Laying Groundwork in Emerging Sectors
Beyond smartphones and pharma, strategic cooperation with G7 members is gaining momentum in clean and renewable energy, climate finance, digital public infrastructure (DPI), healthcare, semiconductor strategy, and maritime security. Policies like Make in India and Production Linked Incentives (PLI) are strengthening domestic capabilities in solar, green hydrogen, semiconductor assembly, and medical devices.
Energy, Security, and Technology Collaboration Take Centre Stage
The PHD Chamber report and associated analysis underscore emerging cooperation in several strategic pillars: Energy & Climate Tech, Security & Maritime Strategy and Digital Governance & AI.
These areas reflect a growing consensus: trade complementing security and sustainability frameworks.
Economic Strength & Demographic Edge
India’s economic momentum reinforces its rising trade profile. Real GDP has grown over 8% annually since FY 2021, compared to modest growth in most G7 countries, and the International Monetary Fund forecasts 6%+ growth through 2029. Rising from 7% to 8.3% of global GDP (PPP) between 2020 and 2024, and projected to exceed 9% by 2029, India’s economy is on a steady incline. A youthful working population (over 68% aged 15–64) adds competitive vitality, in contrast with G7 nations grappling with demographic aging.
Strategic Diplomatic Push at G7 Summit
India’s active participation at the G7 Summit amplified this economic trajectory. Prime Minister Modi highlighted India’s commitment to green transitions, digital leadership, and AI governance. These exchanges also accelerated dialogues on trade deals, such as the UK-India FTA, and cooperation frameworks like the Partnership for Global Infrastructure and Investment.
Indian MSMEs & Supply Chains Benefit
The macro-level momentum filters down to MSMEs: stronger access to high-value G7 markets, aligned regulatory standards, and increased foreign direct investment potential. As Rubix Data Sciences CEO Mohan Ramaswamy noted, “MSMEs are stepping onto the global stage with confidence.” Diversified trade links also help de-risk supply chains, in line with global resilience strategies.
Outlook & Next Moves
India’s trade narrative with the G7 is entering a new phase, one that blends volume with strategic depth. The 61% four-year trade expansion sets the stage for:
- Advancing free trade agreements with the UK, EU, and Canada
- Scaling green-energy partnerships and climate finance
- Elevating digital and AI governance cooperation
- Positioning India as a trusted hub in global supply chains
With economic reforms, youthful demographic tailwinds, and a strategic diplomatic positioning, India’s G7 ties are on track to evolve from mere trade growth to comprehensive strategic engagement. A partnership that grew from USD 154 billion to USD 248 billion now stands poised to shape trade, technology, and security in equal measure.
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