State by State: India and New York Trade

New York is known for its banking sector as well as its fashion, entertainment and jewelry industries. The Port of New York and New Jersey (located in New Jersey) is the third busiest port in the United States and the busiest on the East Coast, allowing for excellent import/export links with India and the rest of Asia.

Trade with India

In 2014, New York was the second-largest state exporter to India from the U.S. after California. Exports to India from New York were worth US$2.51 billion, an increase of 24.4 percent from 2013. Over the past decade, exports from New York have increased 242.6 percent. New York’s top exports are diamonds, gold, jewelry, paintings, civilian aircraft and cell phones, while its top imports are diamonds, gold, paintings, natural gas, petrol, wines and knit cotton goods.

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Jewelry and Gems

New York City is known for being one of the primary locations for the import, export and sale of jewelry and gems – three of New York’s top exports are related to the jewelry industry.  India, meanwhile, is one of the primary locations for diamond and gem mining. In 2009, the diamond gem industry was estimated to be worth a total of US$7.6 billion. India is also one of the largest consumer markets for gold and silver goods, with gold jewelry being very highly prized by many members of Indian society.

According to the Indian Brand Equity Foundation, the Indian jewelry and gem Industry is worth US$40.45 billion. FDI in jewelry and gems is worth near US$500 million, and is expected to grow further in the coming years.

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Biotechnology

India’s biotechnology industry has grown from US $530 million in 2003 to US $4.3 billion at the end of 2013. Many U.S.-based companies outsource clinical trials to India, while India remains strong in clinical data management, drug discovery and low-cost manufacturing. The Indian government has also implemented a number of initiatives to improve infrastructure for the industry as well as incentive schemes for foreign investors.

Agriculture

There was a 69.9 percent growth in agricultural imports from India in 2014. Both India and Illinois contain large agrarian sections of their economy. Investments in agriculture-based industries appear to be lucrative given India’s rapid population growth. However, Illinois-based companies that manufacture agriculture-related machinery and equipment stand to benefit the most from India’s agriculture sector, as well as the Make in India campaign that is designed encourage foreign investment into manufacturing in India.

Pharmaceuticals

New York is also a prominent producer of pharmaceuticals. With one of the world’s largest pharmaceuticals firms, Pfizer, headquartered in New York City, the state has become a leader in marketing, promotion and research of new drugs.

India has the world’s third largest pharmaceutical industry, which is estimated to grow 20 percent over the next five years. In 2013, the Indian Pharmaceutical industry exported US$10 billion worth of drugs. Furthermore, the Indian government recently allowed for 100 percent FDI in the pharmaceutical industry.

With its liberal FDI laws for pharmaceuticals, India is an ideal location for pharmaceutical investors from New York, including for drug research and manufacturing, both of which are considerably cheaper in India than in other Asian countries.

Tax Treaty – U.S. Trade with India

The U.S. has signed a Double Tax Treaty with India. This can reduce tax burdens under certain circumstances in both trade and any India legal establishment. Please seek professional advice for specific India investment requirements.

Further Support from Dezan Shira & Associates

Dezan Shira & Associates can service New York-based companies that are looking to develop their Asia operations. The firm can help companies establish a direct office in the region and can guide them through the affiliated tax, legal and HR issues that come with doing so. To arrange a free consultation, please contact our U.S. office at usa@dezshira.com.

For further New York-Asia trade data, please see our related article on trade with China.

An Introduction to Doing Business in India 2015 (Second Edition)
Doing Business in India 2015 is designed to introduce the fundamentals of investing in India. As such, this comprehensive guide is ideal not only for businesses looking to enter the Indian market, but also for companies who already have a presence here and want to keep up-to-date with the most recent and relevant policy changes. We discuss a range of pertinent issues for foreign businesses, including India’s most recent FDI caps and restrictions, the key taxes applicable to foreign companies, how to conduct a successful audit, and the procedures for obtaining an employment visa.

Using India’s Free Trade & Double Tax Agreements
In this issue of India Briefing magazine, we take a look at the bilateral and multilateral trade agreements that India currently has in place and highlight the deals that are still in negotiation. We analyze the country’s double tax agreements, and conclude by discussing how foreign businesses can establish a presence in Singapore to access both the Indian and ASEAN markets.

Passage to India: Selling to India’s Consumer Market In this issue of India Briefing magazine, we outline the fundamentals of India’s import policies and procedures, as well as provide an introduction to engaging in direct and indirect export, acquiring an Indian company, selling to the government and establishing a local presence in the form of a liaison office, branch office, or wholly owned subsidiary. We conclude by taking a closer look at the strategic potential of joint ventures and the advantages they can provide companies at all stages of market entry and expansion.

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