U.S. and India Strike Interim Trade Framework
Framework sets reciprocal tariff at 18% and cites India's $500 billion purchase pledge over five years.
Overview
The United States and India released a joint interim trade framework on Feb. 6, 2025, that sets a reciprocal tariff rate of 18% on goods from India and calls for India to reduce or eliminate tariffs on U.S. industrial and agricultural products, the joint statement said.
The framework follows months of tension after Washington imposed punitive tariffs to press India over purchases of Russian oil and after President Donald Trump revoked a 25% tariff by executive order on Feb. 6, 2025, the White House said, a timeline that contrasts with Trump's earlier public claim of a 50% tariff.
Indian Trade Minister Piyush Goyal said the agreement protects sensitive agricultural and dairy items including maize, wheat, rice, ethanol, tobacco and some vegetables, while opposition leaders accused the deal of favoring the United States in social media posts and news statements.
The joint statement said India intends to buy $500 billion of U.S. energy products, aircraft and aircraft parts, precious metals, technology products and coking coal over five years, and U.S. Trade Ambassador Jamieson Greer said the deal will lower tariffs for American producers.
Negotiators said they will continue talks toward a formal trade agreement expected in March, and analysts warned that domestic political backlash over agricultural protections could shape final terms, according to think-tank commentary and opposition statements.
Analysis
Center-leaning sources present the reporting neutrally: they relay official claims (Trump’s $500 billion pledge, Modi’s praise, Goyal’s tariff and job estimates) alongside opposition warnings about agriculture. Editorial choices mainly attribute evaluative statements to sources rather than adopting loaded language, balancing government assertions with countervailing political and sectoral concerns.
Sources (4)
FAQ
The framework sets a reciprocal tariff rate of 18% on certain Indian goods, including textiles, apparel, leather, footwear, plastics, rubber, organic chemicals, home décor, artisanal products, and machinery.
India intends to purchase $500 billion worth of U.S. energy products, aircraft and aircraft parts, precious metals, technology products, and coking coal over the next five years.[1]
Sensitive agricultural and dairy items are protected, including maize, wheat, rice, ethanol, tobacco, some vegetables, milk, poultry, and meat.[1]
The U.S. imposed punitive tariffs over India's Russian oil purchases, Trump publicly claimed a 50% tariff but revoked a 25% tariff via executive order on February 6, 2025, with the 18% rate under Executive Order 14257 from April 2025.
Negotiators will continue talks toward a formal trade agreement expected in March 2025, with potential removal of tariffs on additional Indian exports like pharmaceuticals, gems, and aircraft parts upon successful conclusion.
History
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