Explained: This article explains the political background, key decisions, and possible outcomes related to Explained : Tariffs: India-US interim trade deal – the four unanswered questions and Its Impact and why it matters right now.
Under the framework, India has expressed an intention to buy $500bn of US goods over five years, including energy, aircraft, technology products and coking coal.
Critics question whether this is achievable.
According to GTRI, this would require India’s annual imports from the US to more than double every year. The announcement also relies on private sector decisions that are beyond government control.
The commitment also “risks inflating India’s import bill and eroding its trade surplus with the US”, Systematix Research said, warning of longer-term pressure on external balances.
However, Goyal has described the target as “extremely conservative”, citing rising demand for aircraft, energy and data centre equipment.
He says India already has tens of billions of dollars worth of aircraft orders in the pipeline and expects overall imports to grow as the economy expands.
Despite several unanswered questions, India’s stock markets rose sharply on the back of the deal announcement, with lower tariffs, stronger energy ties and deeper economic cooperation with the US expected to add to the country’s growth prospects.
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