New Delhi, July 10 -- Even as global headwinds weigh on India's merchandise exports, the services sector is emerging as a vital cushion, delivering robust growth and helping anchor the country's external balance.

At the current pace, services could catch up with merchandise exports in 2025-26, on an annual basis, marking a significant structural shift in India's external trade dynamics, showed figures shared by exporters.

In the first five months of 2025, services exports rose 16% year-on-year to $173 billion, while the services trade surplus surged 21% to $90 billion, according to data from the Union commerce ministry, offering crucial support to the current account at a time of volatility in goods trade.

Merchandise exports slipped 1...