State by State: India and Wisconsin Trade

June 12, 2015 Posted by India Briefing Reading Time: 5 minutes

Wisconsin, one of the leading dairy producers in the U.S., produces about a quarter of America’s cheese. The agriculture industry forms a significant portion of Wisconsin’s economy. The state ranks first nationally in the production of corn, cranberries, ginseng and snap beans for processing; second in terms of milk production and butter production. The Wisconsin economy grew at a moderate pace in 2013, reaching US$282 billion. Other major industries include manufacturing, energy, power and control, bioscience, food and beverage and water technology.

Trade and Exports

Wisconsin’s imports from India totaled US $677 million in 2014, but Wisconsin only exported US $230 million to India during the same year. Wisconsin’s imports from India have grown since 2011; however, its exports have steadily declined during that same period. Despite this, Wisconsin exported a total US $23 billion in 2014, a record for the state. Top exports from the state include industrial machinery, medical and scientific instruments, electrical machinery, non-rail parts and vehicles and plastics.

Investment Opportunities

Medical & Scientific Devices

Earlier this year, India opened up its medical devices industry, presenting important investment opportunities for Wisconsin businesses to enter the market. In 2014, 9.2% of Wisconsin’s total exports were either medical or scientific instruments. With a growing healthcare and biotechnology sectors, the demand for medical and scientific equipment is expected to grow in India. In addition, India’s growing middle class and expanding healthcare industry is projected to increase the value of the medical device industry to US $50 billion by 2025.

Automotive Industry

India is one of the largest markets for the automotive industry in the world. India has the sixth largest passenger and commercial vehicle manufacturing industry in the world – an estimated 21 million vehicles were produced in the 2013-14 financial year. Within the past year, the Indian automotive industry grew 5.3 percent and currently the automotive industry constituted 22 percent of the country’s manufacturing GDP. Approximately 80 percent of the market is dominated by 2-wheeled vehicles (motorcycles and scooters). Furthermore, the Indian Government allows 100 percent FDI, and excise duty on vehicles was recently lowered from 12 to 8 percent. These conditions offer an attractive opportunity for Wisconsin-based companies that produce automotive products.

RELATED: Pre-Investment and Entry Strategy Advisory

Industrial Machinery

Industrial machinery is the largest export from Wisconsin – total exports amount to US $6.37 billion. Industrial machinery such as nuclear reactors and boilers are bound to see an increase in demand in India, due to the recent civil nuclear cooperation between the US and India, as well as the ‘Make In India’ initiative, which encourages the development of Indian manufacturing. High quality industrial machinery will become a necessity in India as the manufacturing sector continues to grow and move up the value chain.

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 Wisconsin-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 Wisconsin-Asia trade data, please see our related articles on trade with ASEAN, China and Vietnam.

About Us

Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email india@dezshira.com or visit www.dezshira.com.

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