New Delhi, February 7: India and the United States have finalized an interim Trade Agreement that will reduce American tariffs on Indian goods by 18 percent. Prime Minister Narendra Modi praised the agreement on Saturday, calling it “very good news” for both countries.
In a post on the social media platform X, Prime Minister Modi expressed gratitude to President Trump for his personal commitment to strengthening relations between the two nations. He stated, “We have agreed on a framework for an interim trade agreement between our two great countries.”
The Prime Minister emphasized that this framework demonstrates the growing depth, trust, and dynamism of their partnership. It aims to bolster the ‘Make in India‘ initiative by opening new opportunities for hardworking farmers, entrepreneurs, MSMEs, startup innovators, fishermen, and others. He noted that it would create significant employment opportunities for women and youth. Modi reiterated the commitment of India and the US to promote innovation, stating that the framework would strengthen investment and technology partnerships between the two nations.
He also mentioned that the trade agreement would enhance robust and reliable supply chains and contribute to global growth. As India progresses towards becoming a “developed nation,” he affirmed the commitment to building global partnerships that are future-oriented, empower people, and contribute to shared prosperity.
Earlier, Union Commerce and Industry Minister Piyush Goyal stated that this trade agreement would strengthen economic cooperation between India and the US. He highlighted that it reflects a shared commitment to sustainable growth for both peoples and businesses.
In his post on X, Goyal noted that under the framework of the trade agreement, the US would reduce mutual tariffs on Indian goods to 18 percent, providing significant market opportunities in key sectors such as textiles and apparel, leather and footwear, plastic and rubber products, organic chemicals, home decor, handicrafts, and select machinery.
Goyal further explained that tariffs on various goods, including generic drugs, gems and diamonds, and aircraft parts, would be reduced to zero, enhancing India’s export competitiveness and further promoting ‘Make in India.’
He also mentioned that India would benefit from exemptions on aircraft parts under Section 232, tariff rate quotas on auto parts, and negotiations on generic pharmaceuticals, leading to substantial export gains in these sectors. Additionally, the agreement demonstrates India’s commitment to protecting farmers’ interests and maintaining rural livelihoods by fully safeguarding sensitive agricultural and dairy products such as corn, wheat, rice, soybeans, poultry, milk, cheese, ethanol (fuel), tobacco, certain vegetables, and meat.
Commerce and Industry Minister Piyush Goyal concluded that this agreement would help India and the US focus on working together to deepen economic cooperation, reflecting a shared commitment to sustainable growth for their peoples and businesses.