US and India announced a framework for an Interim Agreement on reciprocal and beneficial trade. This agreement cuts overall US tariffs on Indian goods from 50% to 18%. It opens up various market access commitments on both sides.
US reduce tariffs on India from 50% to 18%
The deal was revealed in a joint statement from the White House, which described it as a step toward a comprehensive US-India Bilateral Trade Agreement (BTA). This announcement came shortly after Trump indicated progress in negotiations with New Delhi. It referred to the outcome as “balanced and tough but fair.”
For India, this tariff reduction marks the most significant easing of US trade barriers in years. For the US, it provides essential concessions on market access, standards, and non-tariff barriers in fastest-growing major economies.
Tariffs Down, Access Up
According to the framework, India eliminate or reduce tariffs on all US industrial goods. It also consists wide variety of food and agricultural products. This list includes dried distillers’ grains, red sorghum for animal feed, tree nuts, fresh and processed fruits, soybean oil, and wine and spirits. US exporters have long complained about high duties and regulatory issues affecting these items.
In exchange, the US implement a reciprocal tariff rate of 18% on India -origin goods, a sharp decrease from the previous 50%. This reduction impacts key Indian export sectors, such as textiles and apparel, leather and footwear, plastics and rubber, organic chemicals, home decor, artisanal products, and some machinery. If the Interim Agreement is successfully concluded, Washington also eliminate reciprocal tariffs on many goods designated for “aligned partners,” including generic pharmaceuticals, gems and diamonds, and aircraft parts.
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