No difficulty for India to purchase $500 billion in US goods over next five years: Piyush Goyal

Commerce Minister Piyush Goyal

• India aims to import USD 500 billion in US goods over five years
• Aviation, energy, tech, and metals are key sectors for future imports
• India's overall import demand may reach USD 2 trillion in five years

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Commerce Minister Piyush Goyal on Sunday said India will have no difficulty purchasing goods worth $500 billion from the United States over the next five years, calling the figure “very conservative” given the scale of demand expected from India’s fast-growing economy.

Speaking to PTI Videos, Goyal said India’s overall import demand is projected to rise to about USD 2 trillion over the next five years, creating significant opportunities for US exporters—provided they remain competitive.

“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,” he said.

India and the US on Saturday announced that they have finalised the framework for the first phase of a bilateral trade agreement. According to a joint statement, India has 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 is already importing between $45–50 billion worth of goods from the US annually, largely in areas where domestic production is limited.

“Everything that we are talking about is in continuation and includes what we already are purchasing,” he said, when asked whether the USD 500 billion figure includes existing Boeing aircraft orders.

Highlighting aviation as a major driver, the minister said India already has substantial commitments in place.

“We are going to need aircraft. We are going to need engines for aircraft. We are going to need spare parts. We already have USD 50 billion worth of orders on Boeing alone for aircraft. We have orders for engines,” he said.

In addition to aircraft and engines, Goyal said India would require a steady supply of spare parts.

“So, almost 80, 90 billion (dollars) is already on order for the next five years. We will actually need more than that. I read the other day that Tata plans to place some more orders. My sense is we need at least a 100 billion dollar plus only for the aviation sector, in addition to oil, LNG, LPG, and crude oil,” he said.

The minister also underlined India’s growing need for coking coal to fuel steel production.

“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. And all of these products I'm mentioning are already being imported since the Congress time, since the UPA was in power. Nothing new,” he said.

Goyal said rising consumption in the world’s fastest-growing large economy would further boost demand for advanced technology and equipment.

“There's a growth of demand and consumption of all of these products,” he said. Referring to budget announcements on data centres, artificial intelligence and critical manufacturing, the minister said India would increasingly depend on high-end imports.

“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. Calling the US the global leader in advanced technologies, Goyal said the $500 billion import target significantly underestimates India’s future needs.

“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,” he added.