The Morning Brief US-India BTA: One Deal to Rule them All, One Deal to Bind Them?
Apr 18, 2025
Bipin Sapra, a Tax Partner and global trade expert at EY India, delves into the ambitious US-India bilateral trade deal, targeting a staggering $500 billion in trade by 2030. He navigates the complexities of negotiations amid tariffs that could shake up export dynamics. Topics include potential gains for sectors like electronics and agriculture, the implications for India's manufacturing strengths, and how this deal could strategically disrupt China's market dominance. It's a compelling discussion on the future of global trade.
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Trade Tariffs Threaten Indian Exports
- U.S. tariffs threaten nearly 18% of India's export basket, risking market shrinkage for Indian goods.
- This downturn could weaken Indian manufacturing and reduce U.S. foreign direct investment in India.
Deal to Counter China's Trade Dominance
- The U.S.-India trade deal could shift global supply chains, allowing India to replace China's market dominance in key sectors.
- This may trigger intensified trade competition and alter the existing global trade order.
Key Sectors in Trade Negotiations
- Electronic manufacturing in India, including smartphones, stands to gain significant U.S. market advantage due to tariff exemptions.
- U.S. will push for increased sales of agricultural, defense, and automotive products in India.