India, US to double bilateral trade to $500 bn by 2030

Washington: India and the US have resolved to more than double the two-way trade to USD 500 billion by 2030 and announced plans for a bilateral trade agreement with a view to bringing down duties and increase market access.

According to the joint statement issued after the meeting of Prime Minister Narendra Modi and US President Donald Trump here, the two leaders have also pledged the bilateral trade relationship to promote growth that ensures fairness, national security and job creation. "To this end, the leaders set a bold new goal for bilateral trade – Mission 500 – aiming to more than double total bilateral trade to USD 500 billion by 2030. Recognizing that this level of ambition would require new, fair-trade terms, the leaders announced plans to negotiate the first tranche of a mutually beneficial, multi-sector Bilateral Trade Agreement (BTA) by fall of 2025," it said.

The statement further said that both sides committed to designate senior representatives to advance these negotiations and to ensure that the trade relationship fully reflects the aspirations of the COMPACT (Catalysing Opportunities for Military Partnership, Accelerated Commerce and Technology).

“To advance this innovative, wide-ranging BTA, the US and India will take an integrated approach to strengthen and deepen bilateral trade across the goods and services sector, and will work towards increasing market access, reducing tariff and non-tariff barriers, and deepening supply chain integration,” it added. Normally in a free trade agreement, two trading partners either eliminate or significantly reduce customs duties on maximum number of goods traded between them. Besides, they also ease norms to promote trade in services and boost investments.

During the first term of President Donald Trump, India and the US had discussed a mini-trade deal, but was shelved by the Joe Biden administration as they were not in favour of a free trade agreement. The leaders also welcomed early steps to demonstrate mutual commitment to address bilateral trade barriers. In 2023, the US and India bilateral trade in goods and services stood at USD 190.08 billion (USD 123.89 goods and USD 66.19 services trade). In that year, India’s merchandise exports to the US stood at USD 83.77 billion, while imports were USD 40.12 billion, leaving a trade gap of USD 43.65 billion in favour of India.