India and the United States have unveiled a framework for an interim trade agreement aimed at significantly expanding bilateral commerce and easing market access. Under the proposed arrangement, the US will reduce its unilateral tariff on several Indian exports to 18%, benefiting key sectors such as textiles, apparel, leather goods, footwear, chemicals, machinery, home décor, and select artisanal products.

Key Highlights

• Interim India–US trade pact cuts tariffs, improves market access, and strengthens bilateral commercial and strategic cooperation.
• India plans $500 billion US imports over five years, boosting energy, technology, aviation, and manufacturing sectors.

In return, India has committed to lowering or eliminating tariffs on a broad range of US industrial and agricultural goods, including fresh and processed fruits, soybean oil, nuts, wine and spirits, and animal feed products. The deal also seeks to address long-standing non-tariff barriers, streamline import regulations, and enhance cooperation in technology and innovation.

A major highlight of the pact is India’s plan to import goods worth $500 billion from the US over the next five years, spanning energy products, aircraft and components, precious metals, advanced technology items, and coking coal. The agreement also opens the door to increased trade in high-end technology products such as GPUs used in data centres.

Also Read: US and India Seal Trade Deal; Tariffs on Indian Goods Cut to 18%

Both countries view this interim pact as a stepping stone toward a broader bilateral trade agreement, reinforcing their commitment to building a more balanced, resilient, and mutually beneficial trade partnership.