India has the headroom to purchase additional energy worth $12 billion to $ 15 billion dollars from the US if it is available at the right price and has indicated it in the ongoing trade talks, a senior official said Wednesday.
In the past 7-8 years energy purchases from the US -largely crude oil– has come from from $ 25 billion to around $15 billion.
India aims for higher crude imports
“Right now, we are at around $ 12 billion to $13 billion dollars per annum. There is a headroom of around $ 12-15 billion dollars which we can purchase without worrying about the configuration of refineries,” commerce secretary Rajesh Agrawal told reporters.
As varieties of crude vary, refineries are built to process a particular grade of crude. As Indian refineries have in the past handled American crude of up to $ 25 billion, they can still do so.
“And there is a bilateral commitment and in discussions we are in, we have indicated very positively that India as a country would like to diversify its portfolio as far as energy imports are concerned. That’s the best strategy for a big buyer like India,” he said.
Buying more crude from the US will address Washington’s concerns on the merchandise trade deficit with India, which stood at $ 45.8 billion in 2024.
The Indian negotiating team is already in the US for trade talks and Agrawal is expected to join them tomorrow.
“We are trying to see if we can have a win-win solution between the two sides, which can address some of these tariff issues, which are pre-existing….There is always a possibility of both of us arriving at a solution,” Agrawal said.
Prior to the visit of Indian negotiators the US Ambassador to India Sergei Gor was in New Delhi and held meetings with Prime Minister Narendra Modi, External Affairs Minister S Jaishankar and National Security Adviser Ajit Doval on October 11. On Sunday, he met Agrawal.
Both sides had started negotiations on the first tranche of the bilateral trade agreement (BTA) by end-March. Five rounds of negotiations were held before this process was halted late August as the US imposed 25% additional tariffs on India for buying Russian oil taking the total additional import taxes on Indian imports to 50%.
After a pause, both sides again started negotiations but not on the BTA format. Formal negotiations in the format of the rounds cannot be started immediately as there is a government shutdown in the US.
The talks came back on track when a team from the US led by its chief negotiator – Assistant USTR Brendan Lynch for the BTA visited India on September 16 for the day-long talks on trade related issues.
The visit by US officials was immediately followed by the visit of Commerce and Industry Minister Piyush Goyal and officials to New York from September 22-24. During the visit, Goyal met US Trade Representative Jamieson Greer and Gor.