News / India's trade with the US holds up despite tariffs, as FTA deal nears

India has held onto its US export market despite tariffs, and the two countries appear to be making headway towards a new agreement.  

India’s overall trade deficit declined to a five-month low of $24.53bn in November, driven by a fall in gold, oil ,and coal imports according to government trade data. 

Exports rose to $38.13bn, from October’s $34.38bn, while imports fell to $62.66bn, from some $76bn. 

And despite the high US tariffs on imports from India, they rose nearly 10% month on month, to $6.92bn, that’s up 21% on November 2024’s $5.7bn, following a near-9% year-on-year decline in October, to $6.31bn.  

The US is India’s largest export market.

“India has held fort on the US exports despite tariffs,” Reuters quoted India’s commerce secretary, Rajesh Agrawal, who added that the two countries were nearing a “framework” agreement. 

“There’s a fair expectation that both countries will be able to agree to a deal to lower reciprocal tariffs,” he said. Mr Agrawal didn’t specify a timeline, but indicated “positive engagement” with the US to close a deal “sooner than later”.  

Meanwhile, details of a proposed free-trade agreement (FTA) between India and New Zealand are also likely to be finalised soon.  

“We hope the agreement will be closed and finalised soon… It is expected to be done soon,” Mr Agrawal said yesterday after the conclusion of the fourth round of talks. 

On Friday, New Zealand trade minister Todd McClay and Indian industry minister Piyush Goyal reportedly discussed ways to fast-track negotiations for the proposed FTA. After the meeting, in India, Mr Goyal said on social media: “We explored ways to advance the negotiations for the mutual benefit of both countries” 

One major New Zealand-based exporter previously told The Loadstar that the Indian market was a hurdle, but an FTA would help boost export volumes.  

“The India market is an interesting one for NZ. There are some gnarly tariffs in place that don’t help our export drive… There is genuine intent to increase export volumes and a lot of unity to make this happen,” they said.