The story so far: During Prime Minister Narendra Modi’s U.S. state visit, cooperation on technology emerged as a prominent talking point and yielded some of the most substantive outcomes, according to Foreign Secretary Vinay Kwatra. However, digital trade is also the area where some of the biggest U.S. tech companies have recently flagged multiple policy hurdles, including “India’s patently protectionist posture”. Earlier this year, the Washington D.C.-headquartered Computer & Communications Industry Association (CCIA), with members like Amazon, Google, Meta, Intel, and Yahoo, flagged 20 policy barriers to trading with India in a note titled “Key threats to digital trade 2023”.
What is the current status of India-U.S. technology trade?
Notably, in FY2023, the U.S. emerged as India’s biggest overall trading partner with a 7.65% increase in bilateral trade to $128.55 billion in 2022-23. However, digital or technology services did not emerge as one of the sectors at the forefront of bilateral trade. The CCIA points out in its report that “despite the strength of the U.S. digital services export sector and enormous growth potential of the online services market in India, the U.S. ran a $27 billion deficit in trade in digital services with India in 2020”.
