The government of India has become active in taking new steps to control the trade deficit. India is now giving serious thought to importing gold and silver from the United States. This decision is being considered as part of the strategy to improve India’s foreign trade balance and balance the dependence on the dollar.
According to sources, trade diversification can be one way to bridge the bilateral trade deficit with the US. Under the ongoing negotiations on the Bilateral Trade Agreement (BTA), both partners are considering supply chain integration for mutual benefit. Under the BTA, concessional duty for precious metals and finished jewelry can be beneficial for both.
India’s trade deficit increases when the country’s imports exceed exports. Especially the import of expensive products like crude oil, electronics, and gold and silver further increases this deficit. India’s trade deficit has crossed $74 billion in the first quarter of FY 2024-25 itself.
According to sources, importing high-value items like US gold, precious metals, and gems, apart from crude oil, will help in balancing the trade between the two countries. “The US is troubled by the trade deficit, which is a major reason for imposing a 26% reciprocal tariff on India. The BTA is expected to take proper care of this.”
It is believed that this strategy will have many benefits. Like trade with the US is done in dollars, which can help India in foreign exchange reserve management. Trade relations between India and the US will be further strengthened. India’s trade deficit with the US is low, so this can be balanced by increasing imports from there.
During a media briefing, spokesperson Randhir Jaiswal stated, “We are currently engaged in negotiations for a bilateral trade agreement. We remain hopeful that the ongoing discussions will help us address the trade-related issues and lead to the successful conclusion of the agreement shortly.”
External Affairs Minister S. Jaishankar on Wednesday said the impact of reciprocal tariffs imposed by President Donald Trump on India is not yet known, but the government is in talks with the US administration to deal with the situation by concluding a bilateral trade deal.
