India and U.S. Strengthen Trade Relations: Key Highlights from Recent Discussions
India and the U.S. aim to double bilateral trade to USD 500 billion by 2030, with plans for a Bilateral Trade Agreement by fall 2025. The U.S. seeks tariff reductions from India amid a strong economic relationship characterized by a trade surplus for India and significant foreign direct investments from the U.S.
The recent visit of Prime Minister Narendra Modi to Washington resulted in a mutual commitment between India and the United States to more than double their bilateral trade to USD 500 billion by 2030. Additionally, the two nations plan to negotiate a comprehensive Bilateral Trade Agreement (BTA) by the fall of 2025, aimed at fostering multi-sector cooperation.
During the discussions, U.S. President Donald Trump emphasized that India agreed to significantly reduce its tariffs, responding to previous claims regarding high tariffs that affect U.S. exports. Commerce Secretary Lutnick underscored the importance of pursuing a broad and expansive trade agreement with India rather than negotiating on a product-by-product basis.
In 2023, the bilateral trade in goods and services between the U.S. and India totaled USD 190.08 billion, with India exporting USD 83.77 billion and importing USD 40.12 billion, creating a favorable trade gap for India. Moreover, in the services sector, India exported USD 36.33 billion as opposed to USD 29.86 billion in imports, resulting in a trade surplus of USD 6.47 billion.
The relationship between the two countries has positioned the U.S. as India’s largest trading partner from 2021 to 2024. In the 2023-24 period, the bilateral trade in goods reached USD 119.71 billion, with exports reaching USD 77.51 billion and imports at USD 42.19 billion, consolidating a trade surplus of USD 35.31 billion for India.
Furthermore, between April 2000 and September 2024, India has attracted USD 67.8 billion in foreign direct investments from the U.S., reflecting a strong economic engagement between the two nations.
The Economic Times offers extensive news coverage, including business updates, significant financial events, and more, through various platforms such as WhatsApp and online subscriptions.
In conclusion, India and the U.S. have pledged to significantly enhance their trade relationship with a target of USD 500 billion by 2030. Key measures include tariff reductions and the establishment of a comprehensive Bilateral Trade Agreement. The historical trade data highlights a strong partnership, with India enjoying a favorable trade surplus with the U.S. and substantial foreign direct investment, marking a promising trajectory for future economic collaboration.
Original Source: m.economictimes.com
