India US Trade

Recent Trends & development

• During FY23, India received foreign direct investment amounting to US$ 6.04 billion. With 9% of the total FDI equity inflow, the US is the third biggest source.
• US Ambassador to India, Mr. Eric Garcetti called on Home Minister Amit Shah on July 11, 2023, discussed “building on the positive outcomes” of Prime Minister Mr. Narendra Modi’s visit to the US two weeks ago, the first such meeting between a US envoy and the Home Minister since 2015.
• US Secretary of Energy, Ms. Jennifer M. Granholm and Indian Minister of Petroleum and Natural Gas Mr. Hardeep Singh Puri held the third ministerial meeting of the US-India Strategic Clean Energy Partnership in July 2023, which was launched in September 2021.
• An US-India Defence Acceleration Ecosystem (INDUS-X) was set up “as a network of universities, startups, industry and think tanks to facilitate joint defence technology innovation, and co-production of advanced defence technology.” The US Department of Defence Space Force has signed its first International Cooperative Research and Development Agreement with two Indian startups.
• The Joint Statement issued by the US President Mr. Joe Biden and the Prime Minister of India Mr. Narendra Modi, after their meeting on June 22, 2023, spoke of the two countries being “among the closest partners in the world”, and of a “new level of trust and understanding.”
• The India-US Defence Industrial Cooperation Roadmap which concluded in May 2023, seeks to fast-track technology cooperation and co-production in areas of mutual interest. The India-US Defence Acceleration Ecosystem (INDUS X) – a network of universities, incubators, corporates, think tanks, and private investment stakeholders was launched in June 2023.
• The United States and India launched a new high-level partnership, the “US-India Climate and Clean Energy Agenda 2030 Partnership,” which envisages bilateral cooperation on strong actions in the current decade to meet the goals of the Paris Agreement.
• India and the United States have signed an agreement for cooperation in the development of Air-Launched Unmanned Aerial Vehicles (ALUAV), to expand bilateral defence and military cooperation.
• In 2022, India and the United States signed a bilateral space situational awareness arrangement, and this will support greater information sharing and cooperation in space.
• India is actively participating in the US-led Global Action Plan (GAP) framework launched in February 2022 to bridge policy gaps and end the COVID pandemic. Under GAP, India is leading in three areas, get shots in arms, supply chain resilience, and capacity building for healthcare workers.
• India-U.S. 2+2 Annual Ministerial Dialogue, led by External Affairs Minister and their respective counterparts, reviews bilateral ties in defence, strategic, and security domains as well as important regional and global issues. The fourth 2+2 Dialogue was held on April 11, 2022, in Washington D.C.
• India and the United States are set to sign a Memorandum of Understanding (MoU), which will clear the way for the ISRO's ‘NETRA’ in Bengaluru to start collaborating with the American Combined Space Operation Center (CSpOC) to protect satellites of both nations from natural and man-made threats. It will create a framework for India and the US to share data about space debris and other objects and the potential threat they could pose to the safety and security of the new and existing satellites and the other space assets of the two nations.
• Investment Incentive Agreement between the Ministry of Finance and the U.S. Development Finance Cooperation [DFC] was signed on May 23, 2022, to enable enhanced Investment support provided by US DFC in India.
• The 3rd Counter Narcotics Working Group (CNWG) meeting between India and US was held in New Delhi on July 7, 2022. Indian delegation was led by Director General, Narcotics Control Bureau. An Amended Letter of Agreement (ALOA) for cooperation in drug-related matters was signed.
• Prime Minister Mr. Narendra Modi made his first State Visit to the US from 21-23 June 2023 at the invitation of President of the USA, H.E. Mr. Joseph R. Biden. In addition to a bilateral meeting with President Biden, he addressed a Joint Meeting of US’ Congress and interacted with business and thought leaders.
• President of the USA, H.E. Mr. Joseph R. Biden visited New Delhi from 8-10 September 2023 to attend G-20 Leaders’ Summit. President Biden and PM Modi had a bilateral meeting and co-hosted a group of G20 leaders to accelerate investments in high-quality infrastructure projects and development of 2 economic corridors through the India Middle East Europe Economic Connectivity Corridor and the Partnership for Global Infrastructure and Investment (PGI).
• An Investment Incentive Agreement between our Ministry of Finance and U.S. International Development Finance Cooperation [DFC] was signed in 2022 to enable equity investment, co-insurance, grants, feasibility studies, and technical assistance. As of March 2023, DFC’s India portfolio stood at more than US$ 3.1 billion across 100+ projects.

Conclusion

India-U.S. trade relations have developed into a "global strategic partnership", based on shared democratic values, and increasing convergence of interests on bilateral, regional, and global issues. Despite the COVID-19 pandemic, India-U.S. cooperation witnessed intense engagement under various bilateral dialogue mechanisms in a wide range of areas including defence, security, health, trade, economic, science & technology, energy, and people-to-people ties.