The White House on Friday released a Joint Statement by India and the US on a framework for an interim trade agreement under which America will reduce tariffs on India to 18 per cent.
The framework reaffirms the countries’ commitment to the broader US-India Bilateral Trade Agreement negotiations launched by President Donald Trump and Prime Minister Narendra Modi on February 13, 2025.
“The Interim Agreement between the United States and India will represent a historic milestone in our countries’ partnership, demonstrating a common commitment to reciprocal and balanced trade based on mutual interests and concrete outcomes,” the statement said.
It also said the “United States and India will promptly implement this framework and work towards finalizing the Interim Agreement with a view to concluding a mutually beneficial BTA consistent with the roadmap agreed in the Terms of Reference”.
As per the statement, “India will eliminate or remove tariffs on all US industrial goods and a wide range of US food and agricultural products, including dried distillers’ grains (DDGs), red sorghum for animal feed, tree nuts, fresh and processed fruit, soybean oil, wine and spirits, and additional products”.
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The US will impose 18 per cent reciprocal tariffs on originating goods of India, including textile and apparel, leather and footwear, plastic and rubber, organic chemicals, home decor, artisanal products and certain machinery, slashed from the previous 25 per cent, while the two countries also commit to providing each other preferential market access in sectors of respective interest on a sustained basis. Subject to the successful conclusion of the Interim Agreement, the US will remove the reciprocal tariff on a wide range of goods including generic pharmaceuticals, gems and diamonds, and aircraft parts, the statement said.
Additionally, Trump issued a separate executive order rescinding 25 per cent additional tariffs for India’s purchase of Russian oil, saying India has committed to stop importing Russian oil and buy more US energy products. The order, however, warns that tariffs would be reimposed if India “resumes” Russian oil imports.
“India has committed to stop directly or indirectly importing Russian Federation oil, has represented that it will purchase United States energy products from the United States, and has recently committed to a framework with the United States to expand defence cooperation over the next 10 years,” Trump said in his order.
The order further threatens that “if the Secretary of Commerce finds that India has resumed directly or indirectly importing Russian Federation oil, the Secretary of State, in consultation with the Secretary of the Treasury, the Secretary of Commerce, the Secretary of Homeland Security, the United States Trade Representative, the Assistant to the President for National Security Affairs, the Assistant to the President for Economic Policy, and the Assistant to the President and Senior Counselor for Trade and Manufacturing, shall recommend whether and to what extent I should take additional action as to India, including whether I should reimpose an additional ad valorem rate of duty of 25 per cent on imports of articles of India”.
The joint statement issued by the White House comes a day after Union Commerce and Industry Minister, Piyush Goyal said on Thursday that India and the US will finalise and sign a joint statement regarding the trade deal in the
“next 4-5 days”, a claim seconded by External Affairs Minister, S Jaishankar.
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