India’s exports to US up 5.57% to $60 billion in April-December FY25

India’s exports increased by 5.57% to USD 59.93 billion during April-December due to strong demand in the US market, while imports grew by 1.91% in the same period. Experts predict continued growth in bilateral trade and potential opportunities due to the US-China trade conflict. Concerns remain over possible US tariffs on Indian goods.

NECSTGA raises concerns over the Tea Board’s directive to stop tea production in North India, linking it to increased tea imports from Nepal, Kenya, and other countries. They highlight the adverse effects on over 1.5 lakh small growers, emphasizing the flawed regulations and negative impact on the Indian tea industry’s market value.

India has a key opportunity to enhance its trade within Asia, with emerging corridors including India-US, India-Japan, and Southeast Asia. Gautam Kumra, chairman of McKinsey Asia, emphasizes the importance of manufacturing’s contribution to GDP and the potential of Global Capability Centres (GCCs). He highlights the need for localization and partnerships, particularly between Japan and India.

A weaker rupee alone cannot boost exports, according to FIEO. Depreciation impacts competitiveness when competitor currencies decline more. It inflates import costs, increases production expenses, and drives domestic inflation, reducing consumer purchasing power. Currency volatility complicates price planning for exporters and raises the cost of servicing external debt.

India and the EU are making significant progress in negotiations for a free trade agreement (FTA), according to commerce and industry minister Piyush Goyal. The two sides agreed to build a commercially meaningful trade agenda and work towards a mutually beneficial pact, ahead of the 10th round of talks.

Union minister Ashwini Vaishnaw stated that simplifying the tariff structure is a priority for the Modi government to boost exports as a major driver of economic growth. The goal has shifted to ‘Make in India, Make for the World’, emphasizing export-led growth. Customs laws and procedures will also be streamlined to aid this strategy.

Countries should stay calm and not react quickly to protectionist moves to avoid harming economic growth. WTO urges not to overreact and study policies first. Climate efforts need consistent action from both countries and companies. Renewables and green technology hold economic promise, and progress should continue despite some setbacks.

US-India trade relations face uncertainty as President Trump pushes for reciprocal tariffs. India, with a trade surplus, contemplates reducing tariffs on specific American products. Officials consider a limited trade deal and broader concessions, aiming to strengthen economic ties despite historical disagreements.

Some Indian exporters are facing margin calls and losses due to the sharp decline in the rupee. They had used the target redemption forward (TARF) structure, attracted by the promise of quick profits under low volatility. However, the rupee’s recent fall and increased volatility hindered profit caps and resulted in significant losses.

Ashwini Vaishnaw, leading the Indian delegation at Davos, emphasized India’s trust with global companies and strong US relationship despite potential issues like birthright citizenship changes. India presents a unified front for investments, focusing on manufacturing interest and AI development. Prime Minister Modi’s economic policies and trust in India’s foreign policy are key highlights.