Despite global economic uncertainty and dwindling exports and imports, the United States has emerged as India's largest trading partner for the first half of the current financial year, according to government data. Commerce ministry estimates show that between April and September of 2023, bilateral trade between India and the United States fell from USD 67.28 billion to USD 59.67 billion.
From April to September of 2023, exports to the United States totaled USD 38.28 billion, down from USD 41.49 billion in the same period in 2022.
The first half of the fiscal year saw a drop in imports as well, from USD 25.79 billion to USD 21.39 billion.
Equally disappointing was the 3.56 percent drop to USD 58.11 billion in two-way trade between India and China.
In the first six months of the current fiscal year, exports to China fell slightly to USD 7.74 billion from USD 7.84 billion in the same period last year. From a year ago, imports totaled USD 52.42 billion, dropping to USD 50.47 billion.
Although trade between India and the United States is decreasing due to a downturn in global demand, experts predict that the growth rate will soon join the positive zone.
Despite this, they predicted that in the next years, bilateral commerce with the US will continue to rise as New Delhi and Washington worked to further enhance economic ties.
An early solution for restoration of GSP advantages by the US to Indian exporters is the need of the hour, as it will help further promote bilateral commerce, as previously mentioned by Chairman of the CII national committee on EXIM Sanjay Budhia.
According to Khalid Khan, an exporter headquartered in Mumbai, the United States would remain India's largest trading partner despite global concerns.
SC Ralhan, an exporter headquartered in Ludhiana, predicted that commerce between New Delhi and Washington will expand steadily over the next few years.
"The US should seriously consider restoration of Generalized System of Preferences (GSP) benefits to domestic exporters as it would significantly help boost trade," said Ralhan.
The United States is one of India's few trade surplus partners.
In 2022-23, the United States was India's most important commercial partner. Indian-American commerce increased by 7.65 percent, from USD 119.5 billion in 2021-22 to USD 128.55 billion the following year. The figure for 2020-21 was USD 80.51 billion.
From 2013–14 through 2017–18 and again in 2020–21, China was India’s most important commercial partner. The United Arab Emirates (UAE) was once China's top trading partner in the country.
After Saudi Arabia (USD 52.72 billion) and Singapore (USD 35.55 billion), the United Arab Emirates (UAE) was India's third largest trading partner in 2022-23, with bilateral trade of USD 76.16 billion.
The total value of merchandise traded between India and the UAE amounted to USD 36.16 billion during April to September of 2023.
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