India as US Supply Chain "Way Station" Amid Shift from China, Says USTR

In an interview with Fox News, Ambassador Greer, when asked whether India could be the right place for US companies to move supply chains out of China, said India was a viable option for companies seeking to diversify away from China, noting its manufacturing capacity and workforce strength.

"It can be. We know that many companies are already going in that direction. As you mentioned, we want our supply chains in the United States to be as close to home as possible. But we also know it's a process. When you shift from globalisation to a more resilient and secure economy, you will eventually need to reallocate supply chains. India can be a way station for that," USTR Greer said to Fox News.

"They have a large workforce and manufacturing capacity. Of course, American manufacturing and the American worker must come first. But to the extent that we import from other countries, India can be a good source--as long as it's balanced and fair," he added.

On commitments on the recently concluded framework of the India-US interim trade agreement, Greer expressed optimism, saying India is "really committed", adding that "They (India) have started expanding some of their commitments with respect to purchases. They've already rolled back some of the digital services tax that affected us, and they're moving to reduce tariffs. This is going to be a really important deal, and it's going to reverberate for many years to come."

The United States and India announced a framework for an Interim Agreement on reciprocal, mutually beneficial trade, reaffirming their commitment to a broader Bilateral Trade Agreement (BTA) launched by President Donald Trump and Prime Minister Narendra Modi on February 13, 2025.

As part of the framework, India has agreed to eliminate or reduce tariffs on all US industrial goods and a wide range of US agricultural and food products, including dried distillers' grains (DDGs), red sorghum for animal feed, tree nuts, fresh and processed fruit, soybean oil, wine and spirits, and additional products.

On the other hand, the United States will impose a reciprocal tariff of 18 per cent on goods originating in India, including textiles and apparel, leather and footwear, plastic and rubber products, organic chemicals, home decor, artisanal goods and certain machinery. Subject to the successful conclusion of the Interim Agreement, the US has said it will later remove reciprocal tariffs on select items, including generic pharmaceuticals, gems and diamonds, and aircraft parts.

India also intends to purchase USD 500 billion of US energy products, aircraft and aircraft parts, precious metals, technology products, and coking coal over the next five years.

- ANI