The United States of America (USA) surpassed China to become India’s top trading partner in 2021-22, reflecting strengthening economic ties between the two countries.
According to the data of the commerce ministry, in 2021-22, the bilateral trade between the US and India stood at $119.42 billion as against $80.51 billion in 2020-21.
Exports to the US increased to $76.11 billion in 2021-22 from $51.62 billion in previous fiscal year, while imports rose to $43.31 billion as compared to about $29 billion in 2020-21.
At the same time, exports to China increased marginally to $21.25 billion in 2021-22 as compared to $21.18 billion in the previous year. Imports also rose to $94.16 billion from $65.21 billion in 2020-21.
With the US, India’s trade surplus stood at $32.7 billion in 2021. The trade gap with China stood at $72.9 billion in 2021-22, a major increase from $44 billion in 2020-21.
The bilateral trade between India and the US is expected to rise in the coming years as well, as both the countries are working on strengthening economic ties.
Federation of Indian Export Organisations Vice President Khalid Khan said India is emerging as a trusted trading partner and global firms are reducing their dependence only on China for their supplies and are diversifying their business into other countries like India. “In the coming years, the bilateral trade between India and the US will continue to grow. India has joined a US-led initiative to set up an Indo-Pacific Economic Framework (IPEF) and this move would help boost economic ties further,” Khan said.
Rakesh Mohan Joshi, Director of the Indian Institute of Plantation Management (IIPM), Bangalore, too said that India is home to 1.39 billion people with the world’s third-largest consumer market and the fastest-growing market economy with unparalleled demographic dividend provides enormous opportunities for the US and Indian firms for technology transfer, manufacturing, trade and investment.
In recent years, India has been reducing its economic dependence on China by way of engaging in multilateral trade agreements. This has followed several stand-offs between the two countries, resulting in widespread calls to boycott China commercially.
India can add up to $20 billion to its GDP if it halves its reliance on China, a recent SBI report said.
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