A comprehensive trade agreement between India and the US could significantly boost the South Asian country's exports and boost its manufacturing sector, paving the way for sustained economic growth. About this reported the Bloomberg agency.
Economists say such a deal has the potential to nearly double Indian goods exports to the United States — India’s largest external market, accounting for 19,3% of its total exports — over the next decade. Including services, total exports to the United States could grow by 64%.
The bulk of the growth will come from textiles and light industrial goods — furniture, toys and other consumer products. Analysts say the deal will be a “watershed moment” for domestic manufacturing in India.
India and the US are trying to reach a deal before the July 9 deadline, after which the increased tariffs are due to take effect.
With the Trump administration imposing tough tariffs on China and Vietnam, a deal with a 10% tariff on Indian goods would make India attractive to companies looking for alternatives to relocate production or diversify supply chains, economists say.
If the negotiations fail and higher reciprocal tariffs of 26% are applied to India, the country could lose more than a third of its direct exports to the US, and its GDP would decline by 0,7%.
