This article covers trade between India and Timor-Leste, the goods India exports, the tariff preferences available to Timorese products, and the discussions the two countries have held on oil and gas. It also summarises the economic background the brief gives. It is based on the MEA brief of July 2026, and all figures describe the position at the time of that brief.

Economic background

According to the MEA brief of July 2026, Timor-Leste is among the Least Developed Countries, with a GDP of $2.16 billion and a per capita GDP of around $1450. Public spending is the main driver of economic activity, and the brief notes that productive capacity remains limited.

Oil and gas production provided a windfall that has been saved in the Petroleum Fund, which the brief calls a well-governed sovereign wealth fund. As of 31 August 2025, the Fund had a balance of US$18.74 billion, which the brief describes as equivalent to nine times the country's GDP. The brief identifies the core challenge for policy makers as leveraging these resources to achieve inclusive and sustainable economic growth.

Besides the Petroleum Fund, Timor-Leste receives financial assistance from Australia, Japan, the United States, Portugal and China. The brief also lists the European Union, the Asian Development Bank, the International Monetary Fund, the World Bank and UN agencies such as WHO, WFP, UNDP and UNESCO among its major donors.

The brief cites the mid-term economic review of the Central Bank of Timor-Leste, which found that the economy in 2025 showed resilience, supported by public spending, consumption and a growing credit market. The same review reported subdued inflation and a stable banking system, but also persistent external deficits, dependence on petroleum revenues and limited private sector dynamism.

Bilateral trade

The brief states that Timor-Leste continues to rely heavily on imports to meet its domestic consumption and development needs. Total bilateral trade reached USD 52.20 million in FY 2025-26, which the brief describes as an increase of nearly 36% over USD 38.42 million in FY 2024-25. India's exports rose from USD 38.41 million in FY 2024-25 to USD 51.97 million in FY 2025-26, while imports from Timor-Leste remained, in the brief's words, modest at USD 0.23 million.

The brief gives the following figures for the last three financial years, citing the Department of Commerce, India (all in USD million):

  • 2025-26: exports from India 51.97, imports from Timor-Leste 0.23, total 52.20
  • 2024-25: exports from India 38.41, imports from Timor-Leste 0.01, total 38.42
  • 2023-24: exports from India 48.02, imports from Timor-Leste 0.28, total 48.30

What India exports

The brief names agro products, rice and pharmaceuticals among the major items India exports to Timor-Leste. On the pharmaceutical side, Timor-Leste's Vice Minister of Health, Dr. Ana Isabel, visited India in July 2015 to attend Pharmexcil's International Business Meet in Chennai.

Duty-free access for Timorese products

India has extended duty-free market access to products from Timor-Leste under its Duty Free Tariff Preference (DFTP) Scheme for Least Developed Countries (LDCs). The brief says the scheme provides tariff preferences for products originating from Timor-Leste and is intended to encourage greater bilateral trade.

Oil and gas

In November 2019, Xanana Gusmao, then Chief Negotiator of Maritime Boundaries and Special Representative of Timor-Leste, led a delegation to New Delhi. He held detailed discussions with Shri Dharmendra Pradhan, then Minister of Petroleum and Natural Resources, seeking investment in Timor-Leste's oil and gas sector, with particular reference to the Greater Sunrise Project. Mr Gusmao later took the oath of office as Prime Minister on 1 July 2023.

From 10 to 13 December 2019, a three-member delegation comprising OVL, OIL and EIL visited Timor-Leste. It held discussions with officials of the national oil company, Timor Gap, and the State Regulatory Body, Autoridade national Do Petroleo Meneral, to explore opportunities in the upstream sector of the Greater Sunrise Project and its integration with the setting up of an LNG plant.

The brief describes Greater Sunrise as a projected multi-billion-dollar development of gas and condensate fields on the maritime boundary between Timor-Leste and Australia. It states that the project has been stalled for decades amid disputes over whether the gas should be processed into liquefied natural gas (LNG) in Timor-Leste or in Australia.

Timor-Leste's view on trade and investment

Vice Minister of Trade and Industry Mr. Domingos Lopes Antunes took part virtually in the Voice of Global South Summit on 13 January 2023. He thanked the Government of India for organising the Summit and called for trade integration and an enabling business and investment environment, to contribute to economic growth that is sustainable, inclusive and resilient.

He added that, as a young Least Developed Country, Timor-Leste had to make efforts in building key social and economic infrastructure, including health, education, roads, airports and connectivity, to lay the foundations for socio-economic growth. The brief gives no figures for investment flows in either direction.