Is India the U.S.’s New China?


In a recent interview, Gideon Rachman, Chief Foreign Affairs Commentator at the Financial Times, explored the growing relationship between the U.S. and India. The article primarily targets a British audience, but still playfully mock the Brits’ obsession with the “special relationship” between the UK and US. Most people acknowledge that this relationship originated during the days of Churchill and Roosevelt and further gained strength during the Thatcher and Reagan era. However, it has significantly weakened since the days of Blair and Bush Jr. With Biden firmly focus on Europe, the relationship has now become quite frosty. The primary question is if, how, and when this will affect commodity trading.

Considering the US’s disengagement from China and the increasing tension over China’s aspirations in Southeast Asia, it’s natural that India and the US would seek closer ties. Reading the article, we can understand why MetalMiner’s clients continue to demonstrate a growing interest in India-specific data. From metal prices and indices to price forecasts, the attention to Indian data saw notable increases in 2023. New clients in particular are especially focused on Indian data and commodity trading news.

This graph from U.S. import/export data illustrates why:


A Growth in Mutually-Beneficial Trade

Apart from a pandemic-induced dip during the lockdown, both imports and exports have steadily risen throughout the decade. When examining the category data, it becomes clear that pearls, precious metals, and coins dominate U.S. imports from India. Similarly, these categories feature prominently in exports from the USA to the subcontinent.


Fuels, oils, and distillate products constitute the largest export category. Meanwhile, specific metal categories like aluminum, iron and steel, copper, nickel, lead, and tin represent smaller volumes. This is somewhat surprising considering India is a major producer and exporter of aluminum and steel. Nonetheless, imports and exports within these two categories still amount to billions of dollars. In many cases, the US imports lower-value products for further treatment. Conversely, India continues to import higher-value aerospace, defense, and automotive grades from the US.

The demand for Indian metal price information stems mainly from companies purchasing components or finished goods. With protective tariffs and competitive low-cost domestic producers of both ferrous and non-ferrous metals, the Indian domestic metals market operates on its own dynamics. Therefore, translating US or European prices to India when modeling cost build-ups results in significantly unbalanced outcomes.

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New Agreement Could Strengthen U.S. and Indian Commodity Trading

This month, a significant development occurred that is sure to act as an accelerator to growing trade volumes. Last week, the White House issued a Joint Statement from President Biden and India’s Premier Narendra Modi. The message came after the latter attended a series of meetings in Washington. The statement commits both countries to the US-India Comprehensive Global and Strategic Partnership, leveraging their long democratic histories in stark contrast to an increasingly autocratic China.


The partnership focuses on greater cooperation in areas of trade, particularly high technologies such as space, semiconductors, and defense. It also paves the way for a considerable increase in trade between the two countries, especially in defense products and materials. The extent of the agreement’s implementation remains unclear. However, it certainly has the potential to enhance bilateral trade levels significantly.

The new agreement removes many of the historical barriers that hindered greater technology transfers and the sale of higher technology products. In a few years, we may witness a hockey stick rise on the trade graph. And though it can be a  challenging place to do business, India has the potential to see a considerable increase in trade with US corporations.

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