India and the US on Saturday announced that they have reached a framework for the first phase of the bilateral trade agreement under which both sides will reduce import duties on a number of goods to boost two-way trade.
The framework reaffirms the two countries’ commitment to the broader US-India Bilateral Trade Agreement (BTA) negotiations, launched by President Donald Trump and Prime Minister Narendra Modi on February 13, 2025, according to a joint statement.
While the US will reduce tariffs on Indian goods to 18 per cent from the present 50 per cent, India will eliminate or cut down import duties on all US industrial goods and a wide range of American food and agricultural products, including dried distillers’ grains, red sorghum for animal feed, tree nuts, fresh and processed fruit, soybean oil, wine and spirits.
The first phase of the pact is expected to be signed by mid-March. Implementation of the pact will lead to concessions and the elimination of duties on American goods by India. The US, through a separate executive order, has eliminated the 25 per cent tariffs on India for purchasing Russian oil from February 7, as New Delhi has committed to stopping directly or indirectly importing oil from Moscow.
Trump’s order has said that the US officials will monitor whether India resumes directly or indirectly importing Russian oil.
If it finds that India has resumed directly or indirectly importing the oil, the US officials shall recommend “whether and to what extent I should take additional action as to India, including whether I should reimpose the additional ad valorem rate of duty of 25 per cent on imports of articles of India,” the order said.
The reciprocal tariff of 25 per cent will be reduced to 18 per cent after the US issues an executive order in this regard, which is expected soon.
The statement also said that India has expressed its intention to purchase USD 500 billion of US energy products, aircraft and aircraft parts, precious metals, technology products and coking coal over the next five years. “The US and India are pleased to announce that they have reached a framework for an Interim Agreement regarding reciprocal and mutually beneficial trade,” it said.
On the development, Prime Minister Narendra Modi said the interim trade pact will strengthen ‘Make in India’ by opening up new opportunities for farmers and entrepreneurs, and create jobs for women and youngsters. Commerce and Industry Minister Piyush Goyal said the interim pact will open a USD 30 trillion market for Indian exporters, especially MSMEs, farmers and fishermen, as the US duties on Indian goods will come down to 18 per cent from 50 per cent earlier.
When asked about the oil issue, Goyal said that the external affairs ministry will respond to the matter.
Goyal added that India’s exports worth about USD 44 billion to the US will enter the American market at zero reciprocal tariffs under the agreement.
Cong alleges Indo-US trade pact ‘betrayal’ with India
NEW DELHI, FEB 7 (PTI): The Congress claimed on Saturday that the Indo-US trade pact is “not a deal but a surrender” of the country’s self-esteem and interests, and that it is a betrayal of India and its people.
Addressing a press conference here, Congress’s media and publicity department head Pawan Khera said India will soon become a dumping ground for American products that will hurt the interests of the farmers and small and medium industries here.
“This deal is a betrayal to all that India stands for and all that India stood for over the last 75 years. This is not a deal which is in our interest. This is a total surrender by none other than Narender,” Khera said.
“India has been made into a dumping ground by this deal. I do not want to call it a deal, as a deal is amongst equals and you sit across the table and negotiate. A deal cannot be with a gun held on your head…. It is blackmail, it is a surrender,” he said.
Khera said this is not a pact with the US, but a “compromise with our self-esteem and the interests of our farmers and MSMEs and the middle-class”.
Noting that India has become a dumping ground for the US and it has happened under Prime Minister Narendra Modi’s rule, he said, “With this deal, the back of farmers would be broken further and the coming days will prove how farming in the country would be destroyed due to this deal.” Taking a swipe at the Bharatiya Janata Party-led government, Khera said it now works according to the US time, alleging that all decisions, whether about announcing a ceasefire of military conflicts or a trade deal, are taken in the US.
He said the trade deal was signed between India and the US without Goyal even travelling abroad.
“The entire country, the government is functioning in accordance with the American timezone and there cannot be anything more regrettable than this. A deal is between two partners sitting across the table and not due to blackmail.
“That is called surrender. The name is Narender, the work is surrender. This deal has once again proved this,” Khera said, alleging that Modi has “surrendered” before the US.
He said the Congress does not feel good when the prime minister “surrenders” before any other country, as “it is unfortunate”.