India's ambitious plan to purchase $500 billion of U.S. goods over five years is drawing skepticism from economists who warn it could distort procurement and widen New Delhi's trade deficit. The target emerged after President Trump agreed to slash tariffs on Indian goods to 18% from 50%, provided India more than doubles its annual imports.

The bilateral trade relationship, worth $132 billion in 2024-25 with a $41 billion surplus favoring India, now faces potential upheaval. Economists like Madhavi Arora at Emkay Global call the $100 billion annual import target "aspirational rather than realistic" without explicit policy directives steering companies toward American suppliers. India plans to increase procurement of oil, gas, coking coal, and aircraft from the U.S.

Market reactions suggest caution, with Indian markets steadying after an initial rally. The U.S. accounts for nearly a fifth of India's exports, and economists warn that sharply increased imports could shrink India's largest bilateral surplus while widening its overall trade deficit of $283.5 billion. Independent trade expert Biswajit Dhar notes the deal primarily preserves access to India's key market rather than boosting exports, leaving investors wary of the ambitious headline figure.