Commerce Minister Piyush Goyal on Sunday said India would have no difficulty purchasing goods worth $500 billion from the United States over the next five years, calling the figure conservative given the country’s expanding import demand and economic growth.
Speaking after India and the US finalised the framework for the first phase of a bilateral trade agreement, Goyal said India’s growing economy would generate import demand of nearly $2 trillion over the same period.
“We are even today importing 300 billion dollars of goods that can be imported from the US. We are importing from all over the world. That is going to grow up to two trillion in the next five years... I told my counterparts that look, I can assure you that there is demand in India, but you have to be competitive,” Goyal asserted.
A joint statement issued on Saturday said India had expressed its intention to purchase $500 billion worth of US energy products, aircraft and aircraft parts, precious metals, technology products and coking coal over the next five years.
Goyal said India could already source imports worth about $300 billion from the US that it currently purchases from other countries.
He said large investments announced by global technology firms would drive further demand. “My sense is that we will see 10 gigawatts of data centres” in India, he said, adding that the equipment required for such facilities could be supplied by the US.
Asked whether the $500 billion purchase plan included existing orders, including aircraft deals, Goyal said: “Everything that we are talking about is in continuation and includes what we already are purchasing.”
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India currently imports goods worth $45-50 billion annually from the US, largely in sectors where domestic production is limited, he said.
“We are going to need aircraft. We are going to need engines for aircraft. We are going to need spare parts. We already have $50 billion worth of orders on Boeing alone for aircraft. We have orders for engines,” Goyal said.
He added that aviation imports alone could exceed $100 billion over the next five years, alongside purchases of oil, LNG, LPG and crude oil.
India would also require significant volumes of coking coal for its expanding steel industry. “When we reach 300 billion, which is a stated target and expansion is going on at breakneck speed in the steel industry, we'll need 30 billion dollars per year for cooking coal alone,” he said.
Goyal said rising demand for these products reflected growth in the world’s fastest-growing major economy.
Referring to Budget announcements, he said initiatives to promote data centres, artificial intelligence, critical manufacturing and mineral processing would require advanced machinery and technology. “All of this will require high-quality machinery, ICT products, and Nvidia chips, as well as machinery for AI for quantum computing. Where is all of that going to come from?” he asked, adding that the US remained the world’s leading technology provider.
“So, 100 billion (dollars per year) is very conservative. I think it's extremely conservative for a country which wants to become a 30 trillion dollar economy, which India intends to,” Goyal said.
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