India-US Trade Agreement: Balancing Surpluses and Tariffs
A CRISIL report suggests that India's trade surplus with the US may decrease upon finalizing a bilateral trade agreement. The agreement is expected to allow India to import more from the US, although India's exports may not see significant growth due to existing duty-free allowances.
- Country:
- India
India's trade landscape is on the brink of transformation with impending bilateral trade agreements (BTA) with the United States. According to a recent report by CRISIL, these agreements could diminish India's current trade surplus of USD 41.18 billion.
The report highlights the potential increase in imports of US energy, agricultural products, and defense equipment. While areas for export growth exist, such as smartphones and pharmaceuticals, India should brace for enhanced imports due to higher Indian tariffs.
As the US negotiates reciprocal tariffs, set to resume after a temporary pause, India aims to conclude the first tranche of the trade deal by September. This negotiation could reshape the financial dynamics between the two nations, focusing on reducing the bilateral trade deficit.
(With inputs from agencies.)
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