India’s trade is mostly with Asia, with 59% of imports coming from Asia as a whole, and 49% of exports destined for countries in Asia.
The biggest export destination country for Indian products is the USA (16%), followed by the UAE. The greatest source of imports is China (18%). India has a number of trade agreements with nearby neighbouring countries, such as SAFTA (South Asia Free Trade Area) and APTA (Asia Pacific Trade Agreement), as well as bilateral agreements with countries including Singapore, Japan and Korea. Discussions are ongoing in reaching a free trade agreement between India and the EU.
India’s average applied MFN tariff rate is around 13.4%. Tariffs are higher on agricultural products, with an average MFN applied duty of 32.7%, with beverages and tobacco attracting a 68.6% duty and 56.3% for coffee and tea. This is compared with 10.2% for non-agricultural products. On the manufacturing side it is transport equipment which has the highest tariff, at 19.3%.
India’s exports are fairly diversified, but the highest total exports by value are refined petroleum (9.9%) and diamonds (9.3%). It largest imports are crude petroleum (18%) and gold (6.6%). India’s exports in services has been rapidly increasing over the past 20 years, and UK balance of trade in services with India in 2015 was negative £800m compared with positive £100m in 2005.