Interim trade deal with US to address India's energy needs
What's the story
Union Minister Piyush Goyal has announced that the interim trade agreement between India and the US will address India's energy needs. The deal, he said, would help India secure crude oil at more competitive prices. Both countries have set a target to increase their annual trade to $500 billion by 2030. Goyal said this ambitious goal would include India's energy requirements such as crude oil, liquefied natural gas (LNG), and liquefied petroleum gas (LPG).
Energy growth
India's energy demand growing at 7% annually
Goyal stressed that India, the world's fastest-growing major economy, has an annual energy demand growth of about 7%. He said increasing imports and diversifying suppliers would help secure crude oil at more competitive prices. Last week, India and the US announced a framework for an interim trade agreement under which both countries will reduce import duties on several goods to boost bilateral trade.
Tariff changes
US to cut tariffs on Indian goods
Under the new trade agreement, the US has agreed to cut tariffs on Indian goods from 50% to 18%. Meanwhile, India will remove or reduce import duties on all US industrial goods and a range of American food and agricultural products. Goyal said India currently produces some 140 million tons of steel annually with plans to double this in coming years.
Coal requirements
India relies on 2 to 3 countries for coking coal
To meet its steel production goals, India needs coking coal. The country's imports of this resource are currently valued at around ₹1.5 lakh crore and are expected to double in the coming years. Goyal said India relies on two to three countries for coking coal but having more suppliers would ensure competitive pricing and greater supply security.
Infrastructure access
Goyal seeks greater access to US infrastructure products
Goyal also noted that the US has strengths in infrastructure, connectivity and distribution-related products. He said India wants greater access to these areas to expand into sectors like data centers. Currently, India's IT exports stand at around $200 billion (₹18 lakh crore). Access to advanced equipment from the US could further boost this sector and potentially raise IT exports to around ₹45 lakh crore.