President, U.S.-India Business Council, President, U.S.-Bangladesh Business Council, & Senior Vice President, South Asia, U.S. Chamber of Commerce
June 13, 2023
India recently became the world’s fifth largest economy, and there is no good reason why U.S.-India trade should remain at today’s relatively modest $191 billion. Surely $500 billion in bilateral trade — itself the stated goal of the Biden Administration — shouldn’t be seen as a stretch goal but as one that’s eminently attainable. Furthermore, India’s enormous reservoir of skilled talent and its entrepreneurial culture make it an ideal partner for U.S. business.
Growing U.S.-India trade to $500 billion would strengthen our two great democracies and our free market economies.
Here’s how we do it:
Indian Prime Minister Narendra Modi said in a February speech that a burgeoning India needs as much energy as it can get from all possible sources. U.S. firms can help meet this demand: They are highly competitive in a wide range of energy sectors, from renewables to nuclear. The U.S. is also the world’s leading producer of natural gas, the indispensable bridge fuel allowing economies to slash greenhouse gas emissions. If India’s public and private sectors secure deals with U.S. companies in these areas, U.S. investors are ready to pour in as much as $100 billion right away. Long-term energy contracts also strengthen our convergence as Quad and I2U2 partners.
India Ideas Summit 2023
The annual India Ideas Summit is the flagship event for the U.S.-India Business Council and the premier convention of government, industry, and thought leaders in the U.S.-India Corridor. The theme for this year's Summit, at Chamber headquarters in Washington, D.C., was “Trust, Resilience, and Growth."
Speakers included Secretary of State Antony J. Blinken and Secretary of Commerce Gina Raimondo, both of whom spoke of the deep ties between the two democracies and commitments to strengthening the relationship.
Chamber President and CEO Suzanne P. Clark called on leaders of both countries to commit to $500 billion in bilateral trade.
Recent geopolitics have accelerated a rethink of the U.S.-India defense relationship. Both countries should collaborate to build robust defense and aerospace manufacturing capabilities to ensure we can meet global threats. Both American and Indian private sector firms have demonstrated their capability and credibility in this area, and both governments should encourage further private sector partnerships to accelerate and expand defense production. The U.S. Chamber of Commerce is excited to host the inaugural INDUS X conference in June to stimulate greater defense cooperation between American and Indian startups. [Register now to join us for INDUS X]
For both the U.S. and India, the proverbial goose that lays the golden egg is leadership in the digital economy. Washington and New Delhi should embrace the principle championed by Japan of “data free flow with trust” to support the innovation and entrepreneurship fueling the digital trade revolution. A digital trade agreement—pursued bilaterally or in the context of the Indo-Pacific Economic Framework—can spur growth and strengthen our nations’ global leadership.
Advances in artificial intelligence, quantum computing, 5G/6G communications, commercial uses of outer space, and other emerging technologies have vast potential to advance human welfare. Washington and New Delhi view each other as trusted partners, but both governments should encourage their respective bureaucracies to lean forward to build that future together. Both nations rightfully worry about research finding its way to strategic adversaries, hamstringing the ability of the private sector—including research universities—to finalize joint projects. If both countries successfully leverage their joint Initiative on Critical and Emerging Technologies, which the U.S. Chamber helped launch, they could easier facilitate secure tech and knowledge transfers—allowing the U.S. and India to preserve the rights of free citizens amid the race to design the technology of the future.
How the U.S. and India Are Working Together on Artificial Intelligence
Companies view their talent as one coherent whole, seeking to move their prized personnel to the teams and projects where they have the greatest impact. A U.S. immigration and visa system sorely in need of reform is a huge brake on domestic growth and innovation. Washington and New Delhi recognize that our leading businesses rely on talent pools in both geographies. As India increasingly becomes the single largest resource for scalable skilled talent, immigration and visa reform is imperative. Acting now will grow GDP and prosperity in both countries by leveraging our shared competitive edge in research and innovation.
The COVID-19 pandemic dealt some hard lessons on the need to sustain resilient and secure supply chains for vaccines, diagnostics, and therapeutics. India and the U.S. lead the world in biopharmaceutical research and production, and both nations should incentivize R&D. With support from the Chamber, the U.S. has taken impressive steps through the CHIPS and Science Act. In this vein, India should consider “Research Linked Incentives” to complement its successful Production Linked Incentives. India and America should also launch a joint initiative to address systemic barriers to access and ensure their citizens enjoy sustainable access to high-quality health products and services.
U.S. and India Working Together to Improve Healthcare
Amid intense global competition, it’s evident that no other two countries have so many advantages as the U.S. and India. If we simply play the cards we have been dealt, half a trillion dollars in annual trade may quickly seem like a bar we need to raise yet again.
About the authors
Ambassador (ret.) Atul Keshap
Ambassador (ret.) Atul Keshap serves at the U.S. Chamber of Commerce as President of the United States India Business Council, whose members are dedicated to the growth of commercial ties between the world's two largest democracies.