Dear Members,

There seems to be no end to bad news for global trade. As if high tariff by US and Russia-Ukraine hostilities were not enough to disrupt the supply chains, West Asia crisis since 28 February 2028 has created huge problems for the global trade.

According to UNCTAD April-2026 Global Trade Update released on 7.4.2026, Global trade growth continues, but fragility is rising. Global trade grew by $2.5 trillion in 2025, increasing by about 7.5% to a record of $35 trillion. Trade in goods drove most of the expansion, growing by about 7% and adding roughly $1.8 trillion to global growth. Trade in services grew by around 8%, contributing about $700 billion to the total increase. The ongoing conflict in the Middle East and the shipping disruptions in the Strait of Hormuz are expected to intensify inflationary pressures on an already strained global economy. Rising energy prices, together with higher trade costs linked to tariffs, regulatory changes and the erosion of trade rules, further cloud the outlook. On the upside, strong global demand for AI-related goods, digital technologies and some green-industry products should remain strong and could help sustain trade’s overall performance. The surge in AI- and ICT-related trade drove much of the manufacturing sector’s expansion in 2025 and is expected to remain an engine of growth in the coming quarters. By contrast, energy trade remained volatile, and the automotive sector stayed subdued amid rising protectionism.

During 2025-26, Indian merchandise exports grew marginally by 0.9% to US$ 441.78 billion, while services exports are expected to grow by 7.9% to US$ 418.31 billion, thus overall exports increasing by 4.2% to US$ 860.09 billion. Engineering Goods exports grew by 4.86%, Electronics exports grew by 24.4%, Petroleum exports declined by 14.95% and Gems & Jewellery declined by 5.4%. Exports to US increased marginally by 0.92%, UAE by 1.99% and China by 36.66%. As regards SEZs, merchandise exports grew by ?? to US$ ?billion during 2025-26 and services exports grew by ??? to US$ ????billion.

Hon’ble Finance Minister, in her budget speech, announced a one-time measure for SEZ to DTA supplies on concessional duty. The concessional duties were notified on 31.3.2026, effective 1.4.2026 for a one year period. It is a beginning but SEZ Industry is not very enthused by it as there is a very limited benefit. EPCES has taken it up with Ministry.

Commerce Department has also set up an Inter-Ministerial Committee on 26.2.2026 for formulating SEZ 2.0 policy which is likely to give its report in 6 months.

Government has taken many initiatives to mitigate the adverse impact of West Asia crisis and continued closure of Strait of Hormuz.

This edition also brings you updates on key issues pursued by EPCES with the Government, expert responses to member queries from our knowledge partner, and highlights of activities at both the headquarters and regional levels. We look forward to your valuable feedback and suggestions to make this news magazine more informative and engaging.