New Delhi: US President-elect Donald Trump has vowed to take action through tariffs on goods from India after being irked by the rising deficit in trade with the nation.
In the fiscal gone by, 2023-24, India has had a trade surplus of around $36 billion with the US.
India-US trade has grown significantly, both in absolute value, as well as surpluses in favour of India, during Trump’s first term (January 2017 to January 2021) and Joe Biden’s regime (January 2021 to January 2025), according to ThePrint’s analysis of bilateral trade data from the Indian ministry of commerce.
The first three years of the Biden administration saw an average of $122 billion worth of trade in goods per year between India and the US, in comparison with Trump’s first tenure, when the average trade for the first three years stood at $83 billion.
In the fiscal years 2021-22 to 2023-24, India maintained a trade surplus of $31.95 billion on average with the US. In the first four months (April to July) of the ongoing financial year, trade between the two countries has been $53 billion. However, the year is still not over.
Significantly, compared to the final fiscal of Barack Obama’s presidency (2016 to 2017), India-US trade almost doubled during Trump and Biden’s terms.
In fiscal 2016-2017, total trade in goods between India and the US stood at $64.51 billion. This surged to $119.7 billion by fiscal 2023-2024.
Trade numbers bumped up in the first three fiscals of Trump’s presidency but were impacted by the COVID-19 pandemic in fiscal 2020-2021. India’s trade surplus with the US from fiscal 2017-2018 to fiscal 2019-2020 was roughly $18.46 billion. If fiscal 2020-21 is taken into consideration, average surplus in trade for India with the US comes to $19.53 billion.
In the first three years of Biden’s term, from fiscal years 2021-22 to 2023-24, the average trade surplus for India stood at $31 billion.
In fiscal 2017-18, the first full year of Trump’s first term, trade between the two countries was $74.48 billion, a growth of 15.45 percent from $64.51 billion at the end of financial year 2016-17. In the first three years of the Trump era, trade grew by around 11 percent on average.
In January 2018, Trump set off a trade war with China, by imposing tariffs on goods from the Asian country. Eventually, nearly $300 billion worth of goods from China faced new duties. This policy was continued by his successor Biden, with tariffs on Chinese goods expanded across different sectors.
Trump, 78, is set to assume office for a second term in January 2025 after defeating his Democratic opponent and incumbent Vice-President Kamala Harris. The final count of the electoral college votes is yet to be announced.
Also Read: In victory speech, Trump calls for unity; tells supporters 2nd term ‘will be golden age of America’
A deeper look at trade numbers
Biden assumed power in the US as the world was facing the Covid-19 pandemic, which began in Trump’s final year as president. However, even as the world faced numerous shutdowns due to the pandemic, trade between India and the US fell by only 9.4 percent between fiscals 2019-20 and 2020-21.
In 2019-20, India-US trade in goods stood at $88.90 billion—the highest during Trump’s term—which fell to $80.51 billion in 2020-21. However, in fiscal 2021-22, trade between the two countries surged by 48.4 percent to $119.48 billion.
If the trade growth in 2021-22 could be attributed to the economic bounce from the reopening of businesses post-Covid, the momentum was maintained the next fiscal, with total trade in goods touching $129.4 billion, a growth of 8 percent.
In fiscal 2023-24, trade remained above $100 billion for the third consecutive year during Biden’s presidency, with the total value being $119.7 billion.
While this was a 7.4 percent decrease from the previous year, the absolute value of trade in goods between India and the US continues to be on average much higher than during any previous period.
But the first three years of the Biden era also saw a marked increase in trade surpluses, with India exporting more than it imported from the US. The average trade surplus for India stood at $31 billion in the fiscal years 2021-22 to 2023-24.
In fiscal 2021-22, the trade surplus in favour of India stood at $32.85 billion, which fell to $27.67 billion in the next financial year, before growing to $35.31 billion in fiscal 2023-24.
In the first three fiscals of Trump’s presidency, New Delhi maintained an average of $18.46 billion in trade surplus with the US, which grew to $19.53 billion in the pandemic year.
However, it should be observed that India’s overall trade globally, especially from fiscal 2019-20 to 2023-24, has grown by almost 40 percent. Taking this into account, the share of India’s trade with the US remains almost the same throughout this period, indicating that the growth in bilateral trade may be due to New Delhi’s overall growth in trade.
Between 2019-20 and 2023-24, India’s bilateral trade with the US grew by 34.64 percent, almost keeping pace with New Delhi’s overall growth in trade of goods. While this may explain the growth in absolute value of trade, the average surplus of trade with the US has grown in India’s favour.
(Edited by Nida Fatima Siddiqui)