The interim tariff agreement between India and the United States is expected to expand market access for exporters in both countries and provide a more stable framework for bilateral trade, industry representatives said on Saturday.
The agreement, reached as part of ongoing negotiations to deepen economic engagement, aims to reduce trade barriers and pave the way for a comprehensive Bilateral Trade Agreement (BTA).
According to Rajeev Juneja, President of the PHD Chamber of Commerce and Industry (PHDCCI), the interim framework reflects a shared commitment to expand two-way trade and strengthen long-term economic cooperation.
Under the agreement, the United States will apply a reciprocal tariff rate of 18 per cent on Indian-origin goods, including textiles, apparel, leather and footwear, plastics and rubber products, organic chemicals, home décor items, artisanal goods, and select machinery.
Tariffs on specific Indian export categories—such as generic pharmaceuticals, gems and diamonds, and aircraft parts—are proposed to be removed, subject to the successful implementation and finalisation of the interim arrangement.
The United States will also lift certain national security-related tariffs earlier imposed on Indian aircraft and aircraft parts under steel, aluminium, and copper-related measures.
Industry bodies said the announced tariff adjustments are likely to yield positive trade outcomes across several sectors. Reduced tariff barriers are expected to improve access to the US market for Indian generic drug manufacturers, while the gems and jewellery sector could see improved export volumes and margins, particularly for India’s cutting and polishing industry.
The removal of tariffs on aircraft and aircraft parts is expected to support India’s growing aerospace manufacturing, maintenance, repair and overhaul (MRO), and component supply ecosystem.
Lower reciprocal tariff rates are also expected to enhance the competitiveness of Indian textile and garment exporters in the US market, especially in labour-intensive segments. In addition, reduced trade friction is likely to support exports of industrial machinery, auto components, fabricated metal products, organic chemicals, plastics, and rubber goods.
Artisanal products, home décor, and lifestyle goods are also expected to benefit from improved tariff treatment and more predictable access to the US consumer market.
Dr Ranjeet Mehta, CEO and Secretary General of PHDCCI, said the interim tariff agreement marks an important step in India–US trade relations and could provide momentum towards a broader and more comprehensive trade framework.
-IANS
