The recent years were marked by economic extremes; because of the COVID-19 pandemic, US GDP fell by 8.9 percent in the second quarter of 2020 – the largest single-quarter contraction since the Great Depression. US economic recovery has been slow but steady, reaching 2.7 percent in 2022. India also faced the sharpest GDP drop in the nation’s history during the pandemic, with an overall rate of contraction of 7.3 percent for the 2020/2021 fiscal year. However, India’s consistent economic recovery and resilient, inclusive growth has outpaced the rest of the world, reaching 6.9 percent in 2022.
Since taking office in 2021, US President Joseph Biden with Indian Prime Minister Narendra Modi has prioritized strengthening the US-India Comprehensive Global Strategic Partnership to accelerate US economic recovery and strengthen the US’ presence in the Indo-Pacific region. His administration has revived many initiatives to enhance trade and investment ties like the Trade Policy Forum (TPF) and the revamped the US-India Strategic Clean Energy Partnership, and also launched several critical platforms for increased collaboration including the US – India initiative on Critical and Emerging Technology (iCET) and the Indo-Pacific Economic Framework for Prosperity (IPEF). The latest meeting of the India-US CEO Forum was a testament to their commitment to strengthen bilateral economic ties.
India – US supply chains proved their value and resiliency during the pandemic disruptions, as trade between the two countries not only survived the global economic downturn, but reached new heights and has continued to expand. India – US trade reached $191 billion in 2022, and India jumped three places to become the US’ ninth largest trading partner in 2021. The US has remained India’s top trading partner, with a trade deficit of $45.5 billion in 2021.
The US is the third largest investor in India with a cumulative total of $59.1 billion of foreign direct investment (FDI) cited by Invest India in 2022. The previous iteration of this report found that just 155 Indian companies were responsible for $22 billion in tangible US investments by 2020, and with this seventh edition, it is clear that Indian investment and job creation in the US has continued to grow.
Indian Roots, American Soil
CII launched the Indian Roots, American Soil survey to highlight Indian companies with investments and operations in the US every two years to measure and track the reach and impact of Indian FDI on various aspects and levels of the US economy.
The seventh edition of the report documents the narrative of Indian Industry’s impact on communities throughout the US. Over 160 Indian companies throughout all 50 US states, the District of Columbia, and the territory of Puerto Rico, self-reported their investments and job creation data with CII, as well as details of their corporate social responsibility (CSR) programs and financing of US-based Research and Development (R&D) projects. In addition to highlighting their contributions in US markets, the surveyed companies also ranked their perceptions of states’ business-friendly environments to progress policy efforts to enhance the India – US economic partnership.
Indian investments not only supported US communities throughout the worst of the pandemic downturn, but they have also continued to expand and ensure the competitiveness of US companies and local ecosystems during the recovery period that has followed. CII is proud to present the latest survey data illustrating Indian FDI’s role in strengthening the bilateral India – US economic partnership.
Indian Companies in the United States
Indian companies are spread across all 50 US states, as well as Washington, D.C., and Puerto Rico with tangible investments in 40 states and territories. The survey found that Indian companies in the US have made over $40 billion in tangible investments, with 23 states listed investments of over $100 million. The top ten states with the most reported FDI from Indian companies were Texas ($9.8 billion), Georgia ($7.5 billion), New Jersey ($4.2 billion), New York ($2.1 billion), Massachusetts ($1.4 billion), Kentucky ($908 million), California ($776 million), Maryland ($720 million), Florida ($711 million) and Indiana (582 million).
Indian companies continue to diversify their sectors of operations across the US. This year’s survey, for the first time, indicates a greater number of Indian companies in the life sciences, pharmaceuticals and healthcare sector climb over all other sectors, including the technology sector. The Information and Communication technology and Telecommunications sector continues to retain its might with the largest volume of investment and by far, the largest share of the job creation as well. The number of companies in the manufacturing and automotive sectors is on the rise. The services sector includes financial, legal, logistics, design and engineering services, which is rising in proportion. Other sectors include tourism and hospitality, energy, sustainability, mining, materials and allied services.
The CII report continues to be the most holistic, conclusive tool available to evaluate Indian Industry’s growth across the US. It also illustrates the strength of Indian companies within legislative constituencies and serves as a guide for interested Indian companies to learn about the US’ diverse regional economies.
For more information download the 7th edition of Indian Roots, American Soil report.