So, the main question of this article is Who is India’s biggest trading partner? In 2021, the United States reclaimed its position as India’s largest trading partner, with China falling to second place. According to numbers compiled by the Commerce Department, the increase in imports from China is mostly attributable to an increase in shipments of capital goods, intermediate goods, and raw materials, with a far lower increase in consumer items. Compared to imports in 2019, the Country’s consumer goods imports decreased in 2021. This article will look at which country has recently become India’s top trading partner.
India’s International Trade:
All imports and exports to and from India are included in India’s foreign trade. The Ministry of Commerce and Industry at the federal level. In 2018, foreign trade contributed 48.8% of India’s GDP. India was the eighth largest exporter of commercial services globally in 2016, accounting for 3.4% of global trade in services. India recorded a 5.7% growth in services trade in 2016–17. India’s government maintained semi-autonomous diplomatic contacts even before independence. It possessed colonies (such as the Aden Settlement) that sent and received complete missions, and it was a founding member of both the League of Nations and the UN. India joined the Commonwealth of Nations soon after gaining independence from the United Kingdom in 1947, and it enthusiastically supported independence efforts in other colonies, such as the Indonesian National Revolution. The partition and several territorial issues, particularly over Kashmir, would sour its relations with Pakistan for years to come. India pursued a foreign policy of non-alignment with any major power bloc during the Cold War. On the other hand, India developed close ties with the Soviet Union and got significant military assistance. Now, let’s focus on who is India’s top trading partner and why.
Why is the US Now India’s Top Trading Partner?
So, by now, It’s clear that the country that is India’s biggest trading partner is the US. But now, Let’s look at why the US is now India’s top trading partner. In the pre-pandemic year of 2019, the United States was India’s greatest trading partner, with total bilateral trade valued at $90.1 billion, followed by China, with total bilateral trade valued at $85.5 billion. India’s bilateral trade with the United States plummeted to $76 billion in 2020 due to pandemic-related disruptions, dropping it to second. India’s commerce with China also suffered a setback, falling to $77.7 billion in 2020, but it was still bigger than trade with the United States. According to government estimates, India’s bilateral trade with the United States climbed to $112.3 billion in 2021, regaining the top rank from China, which slid to second place with bilateral trade valued at $110.4 billion. By now, it’s clear that the answer to who is India’s biggest trading partner is the US.
The List of the largest trading partners of India includes:
- Saudi Arabia
- Hong Kong
- South Korea
According to the Ministry of Commerce and Industry, India’s fifteen greatest trading partners accounted for 59.37 per cent of India’s overall trade in 1951–1952. These numbers cover products and commodity commerce but not services or foreign direct investment.
Mineral fuels (refined/unrefined) and gold (finished goldware/gold metal) are India’s two most important exports. Mineral fuels (HS code 27) were the most traded item in 2013–14, with 181.383 billion US dollars in imports and 64.685 billion US dollars in re-exports after refining. Gold and its finished objects were the second most traded items in 2013–14, with imports totalling 58.465 billion US dollars and re-exports totalling 41.692 billion US dollars after value addition.
In 2013–14, these two items accounted for 53% of total imports, 34% of total exports, and nearly 100% of India’s entire trade deficit (136 billion US dollars). Services (exports and imports) are not included in commodity trade. In the 2017–18 fiscal year, the trade surplus in services was US$70 billion.
From the above article, we can conclude the answer to the general questions like who is India’s biggest trading partner? That is, we know, the US. Also, why is the US now India’s top trading partner? In the pre-pandemic year of 2019, the United States was India’s greatest trading partner. India’s bilateral trade with the United States plummeted in 2020 due to pandemic-related disruptions. India’s commerce with China also suffered a setback, but it was still bigger than trade with the United States. As we read above, the List of the largest trading partners of India includes the USA, China, UAE, Saudi Arabia, Switzerland, Hong Kong, Singapore, Iraq, Indonesia and South Korea.