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Trade bodies urge strategic policy push to tap $25 billion opportunity amid shifting global supply chains.

Thenewsdose.com

New Delhi/Chandigarh,  July 14, UPDATED: 9:55 AM

In a significant development aimed at boosting India’s outbound shipments, the Federation of Indian Export Organisations (FIEO) has identified over 300 high-potential products that are expected to see a sharp rise in demand from the United States. The move comes amid escalating trade tensions between the U.S. and China, which have created new opportunities for Indian exporters to fill supply chain gaps.

The list includes products across sectors such as electronics, toys, textiles, leather goods, chemicals, auto components, home décor, and engineering goods, where India can quickly expand its footprint. FIEO believes these segments could help India achieve an additional $25 billion in exports to the U.S. over the next two to three years.

Diversifying Beyond China: A Strategic Opening

The export strategy comes at a time when the United States is increasingly looking to diversify away from Chinese suppliers, particularly in sensitive sectors. The resurgence of tariff barriers and trade restrictions under evolving U.S. policy, including likely measures under a possible second Trump presidency, has made American buyers more receptive to sourcing alternatives from countries like India.

“India is being viewed as a credible alternative in key categories where China previously had a dominant share,” said FIEO Director General Ajay Sahai. “We must seize this moment to deepen our export relationship with the U.S. by offering quality, scale, and reliability.”

According to trade analysts, India’s electronics exports to the U.S. exceeded $11 billion in FY24, and sectors like engineering goods, pharmaceuticals, and ready-made garments are also showing consistent growth. With the proper institutional support, this momentum can be expanded significantly.

Trade Bodies Recommend ₹750 Crore Push for U.S. Market Promotion.

To fully capitalise on this opportunity, FIEO has submitted a proposal to the government seeking a ₹750 crore market development fund spread over three years. The fund would be used to promote Indian products through trade fairs, buyer–seller meets, B2B engagements, and branding initiatives across the United States.

FIEO has also urged the government to extend the Interest Equalisation Scheme (IES) — which offers credit at subsidised interest rates — beyond December 2024. This, they argue, will ensure cost competitiveness for Indian exporters, particularly small and medium enterprises.

Additionally, the trade body has proposed:

• Tax deductions up to 250% for R&D and innovation,

• A renewed Export Development Fund for MSMEs,

• Greater logistics and shipping support, and

• Expanded priority sector lending to exporters.

High-Potential Sectors and Products

FIEO’s research has highlighted product lines with substantial export upside in the U.S. market. These include:

• Electronics and electricals: Circuit boards, connectors, consumer devices

• Apparel and textiles: Cotton garments, technical textiles, home linens

• Toys and leather goods: Eco-friendly toys, footwear, belts, and bags

• Automotive and engineering: EV components, castings, precision tools

• Chemicals and APIs: Organic intermediates, speciality chemicals

• Furniture and décor: Handcrafted wooden goods, lighting accessories

FIEO President Ashwani Kumar said that the trade body is working with industry associations and export councils to align manufacturing capacities with U.S. market standards and sustainability benchmarks. “We must not just export more; we must export better,” he said.

Experts Caution: Reforms Must Complement Opportunity

While the opportunity is clear, experts warn that India needs deeper structural reforms to sustain this export push. These include addressing high compliance costs, improving port infrastructure, and negotiating reductions in non-tariff barriers through trade dialogues.

“Market access is not just about identifying the right products—it also means competing on quality, delivery, and regulatory compliance,” said trade policy expert Devinder Sharma.

Nevertheless, industry leaders and exporters remain optimistic. With the right blend of policy support, credit incentives, and marketing strategy, India could well emerge as a preferred partner for U.S. buyers seeking alternatives in a turbulent global trade environment.