US-India Trade Relations Strengthen as China's Trade Deficit with India Expands

In a significant development, the United States has maintained its position as India's largest trading partner for the fourth consecutive year in FY25, with bilateral trade reaching an impressive USD 131.84 billion. Meanwhile, India's trade deficit with China has seen a notable increase, widening to USD 99.2 billion during the same period.

Trade Dynamics Between India and China

The fiscal year 2024-25 witnessed a contraction in India's exports to China by 14.5%, totaling USD 14.25 billion, down from USD 16.66 billion in the previous year. Conversely, imports from China surged by 11.52%, amounting to USD 113.45 billion, up from USD 101.73 billion in 2023-24. This shift has contributed to a 17% increase in the trade deficit with China, escalating from USD 85.07 billion to USD 99.2 billion.

India's Trade Surplus with the US

India's exports to the US saw an 11.6% rise, reaching USD 86.51 billion, while imports from the US grew by 7.44%, totaling USD 45.33 billion. This growth has bolstered India's trade surplus with the US to USD 41.18 billion, up from USD 35.32 billion in the previous fiscal year.

Future Prospects

With negotiations underway for a trade agreement between India and the US, bilateral trade is poised for further growth. The ambitious target is to elevate two-way commerce in goods and services to USD 500 billion by 2030, a significant leap from the current USD 191 billion.