India, US to increase market access

New Delhi: Union Minister of State for Commerce and Industry Jitin Prasada informed the Lok Sabha on Tuesday that India and the US are planning to negotiate a trade agreement and both countries will focus on increasing market access, reducing import duty and non-tariff barriers and enhancing supply chain integration. During the visit of Prime Minister Narendra Modi to Washington last month, India and the US announced their commitment to more than double the two-way commerce to USD 500 billion by 2030 and negotiate the first tranche of a mutually beneficial, multi-sector Bilateral Trade Agreement (BTA) by fall of 2025.

In 2023, the US-India bilateral trade in goods and services stood at USD 190.08 billion (USD 123.89 billion in goods and USD 66.19 billion in services trade). 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. During 2021-24, America was India's largest trading partner. The US is one of the few countries with which India has a trade surplus.

Prasada also said that India continues to engage with the US to achieve enhancement and broadening of bilateral trade ties in a mutually beneficial and fair manner. "This is an ongoing exercise and Indian exporters are working towards diversifying trade baskets and export destinations," he said.

In 2023-24, India has exported engineering goods worth USD 17.62 billion.

The other major goods included electronics (USD 10 billion), gems and jewellery (USD 9.9 billion), petroleum products (USD 5.83 billion), textiles (USD 4.7 billion), marine products (USD 2.5 billion). In a separate reply, the minister said India's tariff policy aims to regulate trade, protect domestic industries, and generate revenue through taxes on imported and exported goods. "Recent reforms have focused on streamlining the tariff structure and facilitating trade," Prasada said.

India is a member of the WTO (World Trade Organization) and bound to its maximum tariff that can be applied on a product category. The applied tariffs are generally below the bound tariff for a given commodity line.