American exports to India support more than 260,000 jobs directly and indirectly in the US and the cumulative investment from the country into India reached USD 28.3 billion in 2015, a new report said on Monday.
India’s foreign direct investment (FDI) in the US totalled USD 9.2 billion as of 2015, up more than 500 per cent since 2006, said the report ‘India Matters for America/ America Matters for India’, which was released by Federation of Indian Chambers of Commerce and Industry (FICCI) and East-West Centre at an event on the side lines of Prime Minister Narendra Modi’s visit to Washington.
“Every US state exports to India, these exports support more than 260,000 jobs directly and indirectly,” the report said.
Thirty-one states have more than 1,000 jobs dependent on exports to India, while an additional six states have 10,000 jobs or more,” said the report, adding that the cumulative investment from the US into India reached USD 28.3 billion in 2015.Noting that the US is one of the largest sources of investment into India, the report said since 2000, the US invested over USD 20 billion in India, more than six per cent of India’s total inflow of investment.
According to the US Trade Representative, India’s direct investment in the US is led by professional, scientific, and technical services; depository institutions and manufacturing.
Among the Asia Pacific countries, India is the 7th largest investor in the US, it said.
“The study clearly brings out the multi-faceted relationship between India and the US and which has only been strengthening with time. Be it trade, investments, tourism, student exchanges or engagement in strategic sectors like defence, India and the US have continued to contribute a lot to each other’s economy,” said Pankaj Patel, FICCI president.
Stating that the defence trade between the US and India increased from USD 1 billion to over USD 15 billion, it notes that India was named a ‘Major Defence Partner’ of the United States in 2016, a status which was created to facilitate technology sharing with India to a level at par with that of the United States’ closest allies and partners.
The signing of defence agreements such as the Defence Technology and Trade Initiative (DTTI) and the Logistics Exchange Memorandum of Agreement (LEMOA) furthered cooperation.
India conducts more bilateral exercises and personnel exchanges with the US than with any other country, 50 formal events annually, it said.
According to the report, the two-way trade between the US and India increased nearly 200 per cent since 2005, with total value from USD 37 billion in 2005 to USD 109 billion in 2015.
US exports amounted to USD 21.5 billion in goods and USD 18.1 billion in services to India in 2015. The US is the top destination for Indian goods, 14 per cent of India’s export. Also the US is India’s 2nd largest trading partner while India is the 9th largest goods trading partner of the US.
Further US goods imports from India increased from USD 1 billion in 2000 to almost USD45 billion in 2015, a fourfold increase, it said.
Nearly 2,000 American multinational enterprises (MNEs) operate in India, more than from any other foreign country, and employ over a million people, according to US Bureau of Economic Analysis (BEA) estimates, it said adding that sales by these companies amounted to USD 76.7 billion in 2014.
There are also over 200 Indian companies in the United States. These companies have invested over USD 15.6 billion across 37 states and employ over 100,000 people. Sales by Indian MNEs totalled USD 25 billion in 2014, the report said.
More than 1.2 million US tourists visited India in 2015, accounting for over 15 per cent of all international visitors, and contributing over USD 3 billion to the Indian economy, it said.
In the same year, over 1 million Indians traveled to the United States.As the 7th largest source of visitor spending in the United States, Indian tourists contributed USD 11.4 billion to the US economy.
Thirty-one US states saw an economic impact of USD 100 million or greater from spending by Indian visitors, the report noted.
The United States is also the top destination for Indian students studying abroad, with US schools hosting half of all Indian international students.
Almost 166,000 Indian students studied in the United States during the 2015/16 academic year, a 25 per cent increase over the previous year, and contributed over USD 5 billion to the economy.
Indian students make up 16 per cent of all international students in the US.A majority of Indian students study at the graduate level, and 35 per cent study in a math or computer science field.
American students in India numbered over 4,000 during the 2014/15 academic year.India is the 4th most popular destination for US students studying abroad in the Asia Pacific, it said.