August 9, 2025

Hold tight! The World Trade Organisation (WTO) has announced a spicy update: global merchandise trade will grow only 0.9% in 2025. Why the slowdown? It’s all because of the US shaking things up with new tariffs. In fact, many importers rushed to buy from the US earlier to avoid these hefty import taxes, a move called "frontloading." This sudden rush lifted the trade numbers a bit but can't hide the troubling impact of higher costs now looming. According to WTO, "World merchandise trade is now projected to grow 0.9 per cent in 2025, up from the -0.2 per cent contraction forecasted in April but down from the 2.7 per cent estimate pre-dating the tariff increases." That means the fun is slowing down big time compared to before these new taxes. India, however, looks like it’s holding its ground in the storm. The country's exports stayed steady at $35.14 billion in June, even as uncertainties around the world made things tricky. Plus, India's trade deficit – the gap between what we buy and sell abroad – shrank to a four-month low of $18.78 billion, a silver lining for the economy. WTO Director-General Ngozi Okonjo-Iweala perfectly summed up the mood: "Uncertainty remains one of the most disruptive forces in the global trading environment." That means businesses, investors, and supply chains everywhere are feeling jittery. What about regions? Asia remains the shining star, expected to drive the biggest boost in world trade in 2025. But their magic touch will be smaller in 2026 than previously thought. Meanwhile, North America may actually drag down global trade growth in both 2025 and 2026. So, the global trade stage is set for a dramatic show, with winners and losers everywhere. So, will these tariffs be a short spice or a long curry on trade? For now, the world watches closely as the story unfolds.

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Tags: Wto, Global trade, Tariffs, Us imports, India exports, Trade growth,