During the first half of the current financial year, the United States has assumed the position of India’s primary trading partner, despite global economic uncertainties and a decrease in both exports and imports, as indicated by official government data.
According to provisional figures from the Ministry of Commerce, bilateral trade between India and the US has diminished by 11.3%, totaling USD 59.67 billion for the period between April and September 2023, compared to USD 67.28 billion during the same period the previous year.
Exports to the US have also decreased, dropping to USD 38.28 billion during April-September 2023 from USD 41.49 billion the previous year. Likewise, imports have declined to USD 21.39 billion during the first six months of the current fiscal year, down from USD 25.79 billion during the same period the previous year.
Similarly, trade between India and China has contracted by 3.56%, totaling USD 58.11 billion. Exports to China have decreased slightly to USD 7.74 billion during the first half of the current fiscal year from USD 7.84 billion in the year-ago period, and imports have fallen to USD 50.47 billion from USD 52.42 billion the previous year.
Trade experts are optimistic that, despite the decline in exports and imports with the US due to global demand slowing down, the growth rate will soon turn positive. Furthermore, they anticipate that the trend of increasing bilateral trade between India and the US will persist in the coming years, given the ongoing efforts to strengthen economic ties between New Delhi and Washington.
Sanjay Budhia, Chairman of the CII national committee on EXIM, has emphasized the importance of an early resolution regarding the restoration of GSP benefits by the US to Indian exporters, which could significantly boost bilateral trade.
Exporters believe that the US will remain India’s most significant trading partner, even in the face of global challenges.
Notably, the US is one of the few countries with which India maintains a trade surplus. In the previous fiscal year (2022-23), the US held the position of India’s largest trading partner, with bilateral trade reaching USD 128.55 billion, marking a 7.65% increase compared to USD 119.5 billion in the previous fiscal year (2021-22) and USD 80.51 billion in 2020-21.
Previously, China held the title of India’s top trading partner from 2013-14 to 2017-18 and in 2020-21.
Before China, the United Arab Emirates (UAE) was India’s primary trading partner. In 2022-23, the UAE ranked as the third largest trading partner of India with a bilateral trade value of USD 76.16 billion, following Saudi Arabia (USD 52.72 billion) and Singapore (USD 35.55 billion). During April-September 2023, the bilateral trade between India and the UAE amounted to USD 36.16 billion.