New Delhi, March 18 -- India's merchandise trade deficit narrowed to USD 27.1 billion in February 2026, driven by a sharp decline in gold and non-oil non-gold (NONG) imports, according to a report by Union Bank of India.

"Merchandise trade deficit narrowed to $27.1bln in Feb'26 from the unexpected widening of $34.7bln in Jan'26," the report said, adding that the moderation was "marking an improvement in imports."

The report highlighted that imports declined significantly across key segments. "Imports fell significantly, resulting in narrowing in the merchandise trade deficit, led by Gold (down ~40% MoM), NONG (~19% dip) and Oil (~1% slip)," it said.

Despite global trade tensions, exports remained steady. "The data clearly highlights th...