In his first speech to a joint session of the US Congress, President Donald Trump aimed India’s import duties, accusing the country of imposing tariffs that are detrimental to US businesses. Specifically, Trump pointed out that India levies automobile tariffs exceeding 100%. His remarks were part of a broader criticism of trade imbalances and unfair tariffs from other countries around the world, which, according to him, have been taking advantage of the US for decades.
During the address, Trump made it clear that the US would be introducing reciprocal tariffs starting April 2. He stated that for too long, the US had been taken advantage of by other nations and pledged to change that dynamic. “Under the Trump administration, you will pay a tariff, and in some cases, a rather large one,” he said, emphasizing that the US would no longer be subjected to unfair trading practices.
Trump’s speech focused on the high tariffs imposed by countries like the European Union, China, Brazil, India, Mexico, and Canada. He claimed that the US is charged significantly higher tariffs than these countries charge the US, with India’s auto tariffs being among the highest. Trump was unequivocal, stating that it was time for the US to start using tariffs to balance the playing field.
Despite the contentious remarks on tariffs, the US remains India’s largest trading partner, and the trade relationship between the two countries is flourishing. In FY24, bilateral trade between India and the US reached a record US$ 118.2 billion. This growth comes in the face of Trump’s rhetoric, as India maintained a trade surplus of US$ 36.8 billion with the US during the same period.
India’s major exports to the US include engineering goods, electronic goods, gems and jewellery, pharmaceutical products, petroleum products, and crude oil. These exports have significantly contributed to the growing economic ties between the two nations.
India’s export profile to the US is diverse and robust. In FY24, India exported over 7,000 commodities to the US, with engineering goods leading the charge at US$ 17.6 billion. Other significant exports included electronic goods (US$ 10 billion), gems and jewellery (US$ 9.9 billion), and pharmaceutical products (US$ 8.72 billion). Petroleum products also made up a large portion of exports at US$ 5.83 billion.
From April to November 2024, India’s exports to the US amounted to US$ 52.95 billion. The major exported items during this period included engineering goods (US$ 12.33 billion), electronic goods (US$ 6.79 billion), drugs and pharmaceuticals (US$ 6.34 billion), and gems and jewellery (US$ 6.28 billion).
On the flip side, India’s imports from the US have also shown significant growth. In FY24, India imported US$ 40.7 billion worth of goods from the US. Key imports included mineral fuels and oils, valued at US$ 12.9 billion, followed by pearls, precious stones (US$ 5.16 billion), nuclear reactors and machinery (US$ 3.75 billion), and electrical machinery (US$ 2.38 billion).
From April to November 2024, India’s imports from the US reached US$ 29.63 billion, with mineral fuels and oils still being the largest category. Other major imports included pearls and semi-precious stones, nuclear reactors, and electrical machinery.
As the US and India continue to engage in trade discussions, President Trump’s remarks about tariffs and trade imbalances signal a new phase in their economic relationship. Whether or not tariffs will be imposed in the coming months, the US-India trade partnership remains strong, with both nations seeing mutual benefits in various sectors.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
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Published on: Mar 5, 2025, 2:37 PM IST
Sachin Gupta
Sachin Gupta is a Content Writer with 6+ years of experience in the stock market, including global markets like the US, Canada, and Australia. At Angel One, Sachin specialises in creating financial content that simplifies complex market trends. Sachin holds a Master's in Commerce, specialising in Economics.
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