Despite earning over Rs 3.8 lakh crore annually from India, and incurring losses from Pakistan, the US turns a blind eye to Pakistan’s terror exports and refuses to stand firmly with its biggest democratic partner. It’s time India stopped rewarding silence with access and wields an assertive Economic Diplomacy.
SHIVANG SATYA GUPTA
In the age of transactional geopolitics, where even the most powerful nations base alliances on interests rather than ideals, India must shed its diplomatic caution and rise as an assertive economic power. We are not merely a growing market; we are the fourth-largest economy, the largest youth-driven tech base, a nation increasingly central to global balance, and a strategic hub that commands global attention
But despite our rise, a critical imbalance persists in our most celebrated partnership: the India–U.S. relationship. This relationship gets further skewed when we consider US’ relationship with Pakistan.
While India commemorates warmth and camaraderie in bilateral dialogues with the US, the cold figures tell a different story.
In FY 2024–25 alone, the United States earned Rs 12.97–13.41 lakh crore from India—through digital services, defense exports, education, royalties, and FDI returns. Meanwhile, India’s total gains from the U.S.—via trade surplus, remittances, and services exports—barely touched Rs 9.61 lakh crore.
The economic relationship is profitable, but it is not equitable. While India celebrates diplomatic warmth with the U.S., the truth is starker: America earns more from India than India earns from America—by over Rs 3.4–3.8 lakh crore every year.
India’s total annual gains from the U.S.—through trade surplus, services, remittances, and minor returns—amount to Rs 9.61 lakh crore.
In the Financial Year 2024–25, the US has recorded a trade deficit of about USD 44.4 billion with India, which means Washington has imported far more goods and services from India than it exported, using this so-called gap to accuse India of unfairly benefiting from trade, even as US President Donald Trump used this opportunity to impose tariff hikes.
Washington is also using the deficit figures to push India to unilaterally lower tariffs and open its market further.
However, a Global Trade Research Initiative (GTRI) report said that this trade deficit narrative is misleading and incomplete.
According to the think tank, the US quietly rakes in USD 80-85 billion every year from India through education, digital services, financial operations, intellectual property royalties, and arms sales.
These massive earnings do not show up in the narrow goods trade statistics. When you factor them in, the US isn’t running a deficit with India at all – it’s sitting on a USD 35-40 billion surplus.
Converted into INR, this comes out to be a surplus of Rs 2.99 lakh crore to Rs 3.42 lakh crore.
The research undertaken by The Earth News’s investigation team under the leadership of its Editor-in-Chief has found that US profits from India are further higher, at Rs 3.4–3.8 lakh crore every year.
So who’s really gaining more? The answer is clear: the U.S.
What’s more alarming is that even as American corporations profit immensely from Indian consumers and institutions, Washington continues its ambiguous stance on Pakistan, even as the US is losing money in its trade with Pakistan every year.
For the year 2024, the US incurred a loss of Rs 25,650 crore in its trade relationship with Pakistan, even though this is a conservative figure available in public domain. The US losses from Pakistan could be even higher.
Beneath the layers of this relationship, lies a hard truth: America earns handsomely from India and loses huge from Pakistan—yet it refuses to fully align with India’s security imperatives, particularly concerning Pakistan.
When it comes to standing with India on cross-border terrorism or Pakistan-based jihadist safe havens, America still hides behind the veil of neutrality.
The U.S. hesitates to call out Islamabad’s role in nurturing terror proxies—Lashkar-e-Taiba, Jaish-e-Mohammed, and the Haqqani network—even after repeated attacks on Indian soil, from Uri to Pulwama, and Pahalgam to Poonch. America’s silence on the Indian territory illegaly encroached by Pakistan further compounds the diplomatic frustration.
This reflects a flawed equation: Profits flow freely, but political respect remains negotiated.
India’s Untapped Strategic Lever
India’s market is America’s profit machine. The USD 80-85 billion that America quietly rakes in every year from India include include over USD 25 billion spend by Indian students in US, USD 15-20 billion a year made by the US tech giants like Google, Meta, Amazon, Apple, and Microsoft in sales from India’s booming digital market, while American banks and consulting firms earn an estimated USD 10-15 billion in revenue annually from their work in India’s financial sector, advising companies, managing corporate deals, and providing high-end services.
Another major source of US income comes from Global Capability Centers (GCCs) in Indian tech hubs like Bengaluru and Hyderabad. While most work is done in India, much of the real economic value is booked in the US as GCCs earn USD 15-20 billion revenue yearly through India operations, while the American pharma firms earn USD 1.5-2 billion annually through patents, drug licensing, and technology transfer. A
At the bottom end, Auto companies and component suppliers earn USD 0.8-1.2 billion through licensing and technical services, while Hollywood and US streaming platforms contribute another USD 1-1.5 billion through Indian box office sales, subscriptions, and content licensing.
Of course, the US defence sales to India bring in billions more, although exact figures are often kept confidential.
The United States cannot continue to earn billions from India while turning a blind eye to the forces that destabilize our region.
In fact, America continues to fund Pakistan militarily, often ignoring its role in nurturing terror proxies like Lashkar-e-Taiba, Jaish-e-Mohammed etc. Even after repeated Indian submissions of evidence post-Uri, Pulwama, Pahalgam and Poonch attacks, the U.S. response is muted—measured statements without consequences.
This is not about hostility—it is about parity. If America wants to claim strategic partnership in Asia, it must first acknowledge the pain and concerns of its most vital partner.
Assertive Economic Diplomacy
India can no longer allow this one-sided dynamic. It is time we link our economic platforms to political red lines. Here is how India can go about it.
No defense deals without political clarity. If India signs billion-dollar defense agreements with the U.S., they must come with a clear American position on Pakistan-backed terror networks and their role in destabilizing the region.
No digital dominance without sovereign respect. American Big Tech earns billions from Indian users. India must regulate market access through digital sovereignty, cross-border tax enforcement, and data localization—not just in commercial terms, but geopolitical ones.
No investment comfort without strategic alignment. From semiconductors to renewable corridors, incentives must favor nations that respect India’s stance on terrorism and territorial integrity.
Expanding Horizons
India must also diversify its strategic earning channels. With the UAE and Saudi Arabia, India should seek energy equity, fintech leadership, and diaspora monetization.
With Europe, India must close the FTA, focusing on pharma, green tech, and design-led IP exports. In Africa, India can dominate through affordable education, solar exports, and public health consulting.
In Southeast Asia, India should offer RuPay–UPI infrastructure, digital governance tools, and AI law expertise. With Russia and Central Asia, we must build rupee-based trade, defense offsets, and EV partnerships.
India must position itself as a knowledge exporter, not just a labour source. EdTech, AI ethics, cyber governance, climate law, and satellite tech should become India’s foreign currency earners.
India Must Set Terms
It is time for India to turn passive diplomacy into conditional economic strategy. The tools already exist. Defense purchases like GE jet engines, MQ-9 drones, or Boeing aircraft should be tied to verifiable U.S. actions against Pakistan’s terror infrastructure.
Digital data access for U.S. firms must be linked with support for India’s sovereignty in PoK and condemnation of cross-border terror. Market access in critical sectors like AI, fintech, and semiconductors should favor those nations that support India’s national security red lines. India must use its voice in the G20, WTO, BRICS, and climate forums to extract clarity from the U.S., not just praise.
Ending Pseudo-Supremacy
America cannot claim strategic supremacy in Asia while riding on Indian profits and ignoring Indian pain. India is not just a rising market—it is a civilizational state that demands mutual respect. If the U.S. continues to profit from India without honoring its strategic concerns, it ceases to be a partner and becomes a beneficiary of Indian restraint.
The days of soft diplomacy alone are over. India must now behave like what it already is—a global economic power. That means making it clear to partners, especially the United States: “There can be no partnership without political respect. Strategic profits must be matched by strategic accountability. India is open for business—but not at the cost of its sovereignty or silence on its pain.”
Economic diplomacy is India’s most underused weapon. The time has come to wield it with precision, purpose, and pride.
