- greensea
- 12 Feb 2025 03:04 AM
- #Finance & Economics
US-India Trade Relations: Key Insights in 4 Charts
As global trade policies evolve, the economic partnership between the United States and India is under the spotlight. With Prime Minister Narendra Modi visiting Washington this week, discussions are expected to focus on trade policies, tariffs, and strategic economic cooperation. Here’s a closer look at the current state of US-India trade.
1. US-India Trade Reaches Record High
The United States is now India’s largest trading partner, while India ranks tenth among US trade partners. In 2024, bilateral trade between the two nations hit an all-time high of $129.2 billion.
As the US implements 25% tariffs on imports from Mexico and Canada and maintains 10% tariffs on Chinese goods, India has a unique opportunity to expand its exports of technology, electronics, and jewelry to the US. Both nations are also strengthening their economic influence in the Indo-Pacific to balance China’s growing presence.
2. A Growing Trade Deficit in Favor of India
The US trade deficit with India has expanded, with the US importing $45.7 billion more from India than it exported in 2024. Indian goods accounted for 2.7% of all US imports last year.
Despite previous concerns over India’s high tariffs, recent developments indicate a willingness to ease trade restrictions. For instance, India has reduced import duties on motorcycles, a move that directly benefits US-based manufacturers.
3. Key Imports & Exports
The top US imports from India include:
- Pearls and semi-precious stones
- Pharmaceutical products
- Electrical equipment
- Textiles and apparel
- Machinery
In 2023, imports of these five categories from India exceeded $47 billion.
4. Strengthening Defense & Strategic Ties
Beyond trade, both countries are expanding defense and security cooperation. During a recent high-level discussion, leaders addressed:
Enhancing defense collaborations
Security challenges in the Indo-Pacific
India’s increased purchase of US-made defense equipment
With Modi’s visit scheduled for February 12–13, further discussions on trade expansion, investment opportunities, and regional security are expected to take center stage.
What Lies Ahead?
While the possibility of new reciprocal tariffs remains, India is positioning itself as a key trade and strategic partner for the US. With both nations focused on economic growth and global influence, this meeting could play a crucial role in shaping the future of US-India trade relations.
