India-US trade to continue to grow despite regime change: Commerce Secy

India's trade relations with the US will continue to grow irrespective of the change in regime in America, a top government official said on Thursday.

According to the commerce ministry data, India's exports to the US jumped to USD 39.2 billion in October against USD 21.46 billion in October 2015.

During 2001-23, at a Compounded Annual Growth Rate (CAGR), India's exports to America rose by 10.48 per cent. In this period, the US imports from the world have grown by 4.76 per cent.

"Our (India-US) integration is growing and we are getting bi-partisan support. whatever is the regime (in the US), we are finding that our economic integration with the US is increasing over the period of time...and that is a good thing for us and I trust that it will continue (to grow)," Commerce Secretary Sunil Barthwal told reporters here.

 

He added that the two economies have strongly integrated with each other through various agreements, including the IPEF (Indo-Pacific Economic Framework for Prosperity) and other bilateral mechanisms.

"We are able to have a sustained growth in terms of exports and imports," he said.

The data is showing not only the resiliency but also better integration with the US value chains and "this is very positive factor which is across all presidencies," he added.

When asked whether India would ask for the proposed mini-trade deal which was discussed during the first Trump administration, the secretary said that presently the President-elect is building his team and once that team is in place, there will be policy pronouncements from them and based on that "we will be also taking a call".

The US is the largest trading partner of India in 2023-24. India's exports stood at USD 77.51 billion, while imports aggregated at USD 42.2 billion in the last fiscal.

During April-October this fiscal, the country's exports to America rose by 6.31 per cent to USD 47.24 billion, while imports grew by 2.46 per cent to USD 26 billion.

Additional Secretary in the Department of Commerce Rajesh Agrawal said that in the services area also, India's exports and imports have registered healthy growth with the US.

Trade experts have stated that Indian exporters may face high customs duties for goods like automobiles, textiles and pharmaceuticals if the new US administration decides to pursue the 'America First' agenda, opined trade experts.

Experts have said that Trump could also tighten H-1B visa rules, impacting costs and growth for Indian IT firms.

Over 80 per cent of India's IT export earnings come from the US. The US is India's largest trading partner, accounting for over USD 190 billion of annual trade.

Global Trade Research Initiative (GTRI) Founder Ajay Srivastava has said that Trump may extend tariffs beyond China to include India and other countries.

Trump had earlier called India a "large tariff abuser" and in October 2020 labelled India as the 'tariff king'.

These remarks suggest that Trump's second term could bring tougher trade negotiations, he has said.

International trade expert Biswajit Dhar said that Trump would increase tariffs in various sectors as he has to follow his call for MAGA (Make America Great Again).

Between FY 2020 and FY 2024, India's merchandise exports to America rose by 46 per cent from USD 53.1 billion to USD 77.5 billion.

Imports from the US also grew to USD 42.2 billion last fiscal from USD 35.8 billion in 2019-20.

On the other hand, trade in services between the two nations expanded 30.3 per cent from USD 54.1 billion in 2018 to an estimated USD 70.5 billion in 2024.

India is also a key destination for American businesses such as professional, scientific, and technical services, manufacturing, and IT. Washington is the third largest investor. India received USD 66.7 billion of FDI inflow between April 2000 and June 2024.