India’s services exports have turned into the macroeconomic equivalent of a comfort blanket. Policymakers routinely invoke the country’s resilience in software, business services and remittances as evidence that the current account deficit remains well within the bounds of sustainability. Yet, with the global trade landscape shifting dramatically—and not in India’s favour—this optimism risks becoming a distraction from structural vulnerabilities that could soon resurface.The Reserve Bank of India, in its recent commentary, highlighted the net services and remittance surplus as a reliable counterweight to the merchandise trade deficit. The headline numbers seem to support that view. From April 2024 to February 2025, India’s services exports stood at $352 billion, up nearly 13% from a year earlier. The net surplus for that period rose to over $170 billion, a meaningful buffer against a growing merchandise trade gap of $261 billion for the April–February period.
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