Boeing, Nvidia and more: India can easily buy $500-B US goods, says Goyal

Union Commerce and Industry Minister Piyush Goyal feels India will face no problems in buying goods from the United States worth $500 billion over the next five years, one of the key points of the framework that the two have decided upon for an interim trade deal.

A joint statement issued by the countries on Saturday (February 7) revealed India’s intention to purchase $500 billion of American energy products, aircraft and aircraft parts, precious metals, technology products, and coking coal over the next five years.

On Sunday, Goyal called the $500 billion a very conservative number, claiming that the Asian economy will generate a demand of about $2 trillion. Currently, he said, India could source imports worth about $300 billion from the US that it currently buys from other countries.

“We are even today importing $300 billion 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 told in an interview to PTI.

Goyal further said big tech firms have announced large investments in India and, therefore, “my sense is that we will see 10 GW of data centres” in the country, and for that India will need equipment, which the US can supply.

India's Boeing order

Asked whether the $500 billion purchase plans from the US include orders India has already placed for Boeing aircraft, Goyal said, “Everything that we are talking about is in continuation and includes what we already are purchasing.” Even today, he said, India is importing $45-50 billion from the US, and these are products that India does not produce.

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“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 for Boeing alone for aircraft. We have orders for engines,” he added.

In addition to that, the minister said India requires spare parts. “So, almost $80-90 billion 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.

Coking coal purchases

Further, Goyal said the country requires coking coal for the steel industries. India is already importing about 17-18 billion tonnes of coking coal.

“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 per year for coking 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.

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The demand for these goods is increasing in the world's fastest-growing large economy, he added.

“There's a growth of demand and consumption of all of these products. In addition, we announced in the budget that we want to promote data centres, we want to promote the AI mission, and we want to promote critical manufacturing and critical minerals processing in India. 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 said.

He added that the most powerful technology provider is the United States. “So, 100 billion (dollars per year) is very conservative. I think it's extremely conservative for a country that wants to become a 30 trillion dollar economy, which India intends to,” Goyal added.

(PTI interview. Graphics data sourced from government and media reports.)