India’s history of partners and changing business models

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New Delhi: The United States (US) has been India’s largest trading partner since 2018-19. With the exception of 2020-2021, when China overtook the United States as India’s top trading partner, mainly due to the devastating impact of the Covid-19 pandemic and chain disruptions. of global supply, America is India’s largest trading partner with a balance of trade in favor of New Delhi.

The return of the United States

According to Commerce Department data, Indo-US trade in 2021-22 crossed $151.84 billion compared to its two-way trade with China at $146.08 billion in the fiscal year.

In 2020-21, trade with the United States dipped below China due to supply chain disruptions. While India’s two-way trade with the United States topped $80.5 billion, trade with China stood at $86.4 billion, according to official data.

In 2019-20, trade between India and the United States reached $88.9 billion, while China came second with $81.9 billion.

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The data shows that the United States has been the top destination for India’s merchant exports for the past three fiscal years, while China has held the third position in two of the three fiscal years (2021-22 and 2019- 20). In 2020-21, China had overtaken the United Arab Emirates (UAE) at $21.19 billion due to weak demand for goods from the UAE at the height of the Covid-19 pandemic. That year, India’s exports to the United Arab Emirates amounted to $16.7 billion.

Main trading partners, articles

According to official data, India’s top five export destinations in 2021-2022 are the United States ($96.4 billion), the United Arab Emirates ($36 billion), China (25. $4 billion), Bangladesh ($21.25 billion) and the Netherlands ($16.99 billion).

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The top five importing countries during the fiscal year were China ($120.69 billion), the United Arab Emirates ($56.95 billion), the United States ($55.39 billion), the Saudi Arabia ($45.82 billion) and Iraq ($42.4 billion).

India’s top five export commodities in 2021-22 are refined petroleum products ($88.75 billion), pearls, precious and semi-precious stones ($35.14 billion), iron and steel ($28.2 billion), drug formulations and biologics ($23.9 billion), gold and other precious metal jewelry ($11.06 billion) and aluminum and its products ($3.12 billion).

The country’s top five imports in 2021-22 are crude oil ($159.3 billion), petroleum products ($51.7 billion), gold ($46.16 billion), coal and coke ($41.78 billion), pearls, precious and semi-precious stones ($39.93 billion) and electronic components ($9.02 billion), according to official data.

The balance

While India’s merchant exports showed an impressive growth of 44.58% year-on-year in 2021-22 to $421.9 billion, the country has a huge trade deficit due to growing imports. India’s imports jumped over 55.3% in 2021-22 to $612.6 billion, leaving a shortfall of about $191 billion for the year.

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However, in services trade, India has a surplus. According to official data, India’s services exports in 2021-22 showed an annual growth of 23.42% to $254.35 billion. Imports increased by about 25% to about $147 billion, giving a favorable trade balance of $107.4 billion.

In services exports (2021-2022), India set a new record breaking the previous record of $213.2 billion in 2019-2020. In addition, services exports reached an all-time high of $26.9 billion in March 2022. Telecommunications, computer and information services, other business services and transportation are the main contributors. service exports during the year.

Chart 1 (2021-22) + Chart 2 (2020-21) + Chart 3 (2019-20):

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