Bajoria said the immediate takeaway from the evolving trade discussions is constructive for India’s broader growth outlook. As one market participant summed it up, “the first reaction is that this is going to be a positive for growth. I think what we are basically debating is to what extent it is going to be positive.”
Beyond the competitiveness impact on exports, Bajoria flagged that the more complex part of the deal lies on the import side. He stated that while sensitive sectors such as agriculture are expected to be protected through carve-outs, the size and structure of future imports from the US remain a key area of debate.
India currently imports around $50 billion worth of goods from the US, and discussions now centre on whether that figure could rise to $100 billion. Bajoria highlighted that it is still unclear whether this implies an immediate move to a $100 billion annual run rate, or whether it represents an average target spread over the next five years.
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Importantly, he said any increase in US imports is unlikely to be purely incremental. Instead, the shift is expected to come largely through substitution from other trading partners, rather than a sharp expansion in India’s total import basket.
Bajoria added that this substitution would be easier to accommodate because India’s overall import demand is projected to rise in the coming years, creating natural room for changes in sourcing patterns without disrupting domestic demand conditions.
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For the entire interview, watch the accompanying video
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