How India’s Exports to USA Have Grown Over the Years

India is one of the largest trading partners of the USA and one of the few countries with which the USA had a trade deficit in 2021-22. India’s exports to the USA include a variety of products, such as gems and jewelry, pharmaceuticals, petroleum, electronics, engineering goods, apparel, marine products, and more. In this article, we will explore how India’s exports to the USA have grown over the years, what are the major products that India exports to the USA, and what are the recent trends and developments in the bilateral trade relationship.

India-USA Trade Overview

According to the data from the Reserve Bank of India, the bilateral trade between India and the USA stood at a record US$ 119.42 billion in 2021-22, as compared to US$ 80.51 billion in 2020-21. India had a trade surplus of US$ 32.8 billion with the USA in 2021-22, which means that India exported more than it imported from the USA. Of the total trade of US$ 55.57 billion in the first five months of FY22 (Jan-May), Indian exports to the USA stood at US$ 35.99 billion, while American imports stood at US$ 19.58 billion. The USA is also the third largest investor in India, with cumulative FDI inflows of US$ 56,753 million from April 2000 to September 2022.

Major Exported Items from India to the USA

India exported 7,546 commodities to the USA in FY21, amounting to US$ 76.17 billion, which was an increase from US$ 51.62 billion in the previous fiscal year. The major exported items from India to the USA include:

• Pearls and precious stones/metals and articles thereof, imitation jewelry and coin (US$ 14,667.49 million)
• Pharmaceutical products (US$ 6,472.25 million)
• Nuclear reactors, boilers, machinery, and mechanical appliances; parts thereof (US$ 5,798.52 million)
• Articles of apparel and clothing accessories (US$ 4,880.91 million)
• Organic chemicals (US$ 3,894.83 million)
• Vehicles other than railway or tramway rolling stock; parts and accessories thereof (US$ 3,507.12 million)
• Electrical machinery and equipment; parts thereof; sound recorders and reproducers; television image and sound recorders and reproducers; parts and accessories of such articles (US$ 3,477.79 million)
• Mineral fuels, mineral oils & products; bituminous substances; mineral waxes (US$ 2,948.08 million)
• Fish and crustaceans; molluscs and other aquatic invertebrates (US$ 2,535.63 million)
• Iron and steel (US$ 2,343.27 million)

India’s exports to the USA stood at US$ 53.14 billion during April-November 2022. The major exported items from India to the USA during this period include pearls, precious and semi-precious stones (US$ 6,803 million), followed by drug formulations and biologicals (US$ 4,489 million), nuclear reactors, boilers & parts (US$ 3,999 million), articles of apparel & clothing accessories knitted or crocheted (US$ 3,426 million), etc.

Recent Trends and Developments

The trade and economic relations between India and the USA have been growing steadily over the years, despite some challenges and disputes on issues such as tariffs, intellectual property rights, market access, etc. The two countries have launched several initiatives and dialogues to enhance their cooperation on various sectors such as energy, climate change, defense, health care, education, innovation, etc.

Some of the recent trends and developments in the bilateral trade relationship are:

• During FY2020-21, India received the highest-ever foreign direct investment amounting to US$ 81.72 billion. With 17.94% of the total FDI equity inflow, the United States of America is the second biggest source.
• The United States and India launched a new high-level partnership, the “U.S.- India Climate and Clean Energy Agenda 2030 Partnership,” which envisages bilateral cooperation on strong actions in the current decade to meet the goals of the Paris Agreement.
• The two countries also announced a new initiative called “Greening America’s Infrastructure,” which aims to mobilize private sector investment in clean energy projects in both countries.
• The two countries also agreed to resume negotiations on a bilateral investment treaty (BIT) and a totalization agreement (which would allow workers to transfer their social security benefits across borders).
• The two countries also signed a Memorandum of Understanding (MoU) on Intellectual Property Cooperation, which will facilitate exchange of best practices, capacity building, and joint activities to promote innovation and creativity.

Exports to USA from India: Trends and Opportunities

India and the United States have a strong and growing trade relationship, with bilateral trade reaching US$ 80.23 billion in 2022, according to the United Nations COMTRADE database. India’s exports to the USA accounted for 16.8% of its total exports in 2022, making it the largest export destination for India. The main export items from India to the USA include pearls, precious stones, metals, coins, pharmaceutical products, mineral fuels, oils, distillation products, machinery, nuclear reactors, boilers, electrical and electronic equipment, among others.

Exports to USA from India: Impact of COVID-19 Pandemic

The COVID-19 pandemic had a significant impact on the global trade and economy in 2020 and 2021. However, India’s exports to the USA showed resilience and recovery amid the crisis. According to the Reserve Bank of India, India’s exports to the USA decreased by 7.8% in 2020 but increased by 36.5% in 2021. India’s exports to the USA in June 2023 were US$ 521.56 billion, which was 3.7% lower than May 2023 but 40.6% higher than June 2022. Some of the sectors that witnessed a surge in exports to the USA during the pandemic include gems and jewellery, agricultural products, handicrafts, electronic goods and pharmaceutical products.

Exports to USA from India: Future Prospects and Challenges

India and the USA have immense potential to enhance their trade and economic cooperation in the future. According to the Indian Brand Equity Foundation (IBEF), India exported 7,546 commodities to the USA in FY21 and there is scope for further diversification of products and markets. Some of the emerging sectors that offer opportunities for Indian exporters to the USA include renewable energy, digital services, healthcare, education, tourism and defence. However, there are also some challenges that need to be addressed to boost India’s exports to the USA. These include tariff and non-tariff barriers, intellectual property rights issues, trade disputes, regulatory uncertainties and geopolitical tensions.

References:

http://hdr.undp.org/sites/default/files/2018_human_development_report.pdf

http://www.indiana.edu/~league/1thordinaryassemb.htm

http://go.worldbank.org/RJEB2JGTC0

India Exports to United States – TRADING ECONOMICS

https://www.ibef.org/indian-exports/india-us-trade

https://tradingeconomics.com/india/exports-to-united-states

https://www.seair.co.in/blog/india-export-to-usa–major-exports-and-exporters-of-india.aspx

https://oec.world/en/profile/bilateral-country/ind/partner/usa

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