The trade relationship between India and the United States has seen significant growth over the past few years, marked by increasing trade volumes and a focus on diversifying the range of products exchanged. In February 2025, both nations set an ambitious goal to elevate their bilateral trade to $500 billion by 2030, underscoring the deepening economic ties between the world’s largest democracies.

Trade Volumes and Growth Trends (2021-2024):

According to data from the U.S. Census Bureau, the trade in goods between the U.S. and India has shown a consistent upward trajectory:

2021:

U.S. Exports to India: $39.8 billion

U.S. Imports from India: $73.3 billion

Trade Balance: -$33.5 billion

2022:

U.S. Exports to India: $46.9 billion

U.S. Imports from India: $85.5 billion

Trade Balance: -$38.6 billion

2023:

U.S. Exports to India: $40.3 billion

U.S. Imports from India: $83.7 billion

Trade Balance: -$43.3 billion

2024:

U.S. Exports to India: $41.8 billion

U.S. Imports from India: $87.4 billion

Trade Balance: -$45.7 billion

These figures indicate a steady increase in bilateral trade, with total trade in goods reaching $129.2 billion in 2024, up from $113.1 billion in 2021. The trade deficit has also widened, reflecting the growing import of Indian goods into the U.S. market.

Major Products Traded:

The trade portfolio between the two countries encompasses a diverse range of products:

U.S. Exports to India:

Mineral Fuels: Including crude oil, anthracite coal, and natural gas, accounting for approximately 27% of total U.S. exports to India.

Precious Stones and Metals: Such as diamonds and gold.

Aircraft and Machinery: Including civilian aircraft and industrial machinery.

Organic Chemicals: Used in various industrial applications.

U.S. Imports from India:

Pharmaceutical Products: Medicines and therapeutics, with imports valued at $7.2 billion.

Precious Stones and Metals: Including diamonds and jewelry.

Textiles and Apparel: Garments and related products.

Seafood: Notably crustaceans, amounting to $1.8 billion in imports.

These categories highlight the complementary nature of the trade relationship, with each country supplying goods that are in demand in the other’s market.

Tariffs and Trade Barriers

India’s Tariffs:

Motorcycles – Up to 50% for high-end models like Harley-Davidson.

Agricultural Products – Vary widely, with some products like apples at 50% duty.

Medical Devices – High tariffs on certain devices, though there’s been some reduction recently.

U.S. Tariffs:

Steel and Aluminum – Subject to Section 232 measures, but retaliatory tariffs from India have been withdrawn or reduced on certain products.

General Tariffs – Typically lower than India’s, but specific products like medical devices can face significant duties when entering the U.S.

Strategic Initiatives and Future Outlook:

In a significant development, Indian Prime Minister Narendra Modi and U.S. President Donald Trump, during a meeting in Washington in February 2025, announced a mutual commitment to more than double bilateral trade to $500 billion by 2030. This ambitious target is to be achieved through the negotiation of a comprehensive and mutually beneficial trade agreement. The leaders emphasized collaboration in emerging sectors such as artificial intelligence, semiconductors, and the establishment of robust supply chains for strategic minerals. Additionally, both nations are focusing on reducing trade barriers, including tariffs, to facilitate smoother trade flows. India has already initiated tariff reductions on select U.S. goods, signaling a move towards more equitable trade practices.

The commitment to enhancing economic cooperation is further evidenced by India’s plans to increase imports of U.S. oil, gas, and defense equipment. These initiatives are expected to not only balance the trade deficit but also strengthen strategic ties between the two countries. As both economies continue to expand, the deepening of trade relations is poised to yield substantial benefits, fostering innovation, creating jobs, and contributing to global economic stability.