US, India unveil interim trade framework: What benefits will India get?

US, India(BHARAT) Unveil Interim Trade Framework: The United States and India(BHARAT) on Friday announced a framework for an interim trade deal that is reciprocal and mutually beneficial trade, showing fresh progress toward a wider bilateral trade agreement following months of crucial talks and recent tariff tensions. Under the new agreement, the Trump administration will reduce tariffs on India(BHARAT) to 18 percent. The step marks another major step toward advancing the broader Bilateral Trade Agreement (BTA) negotiations launched by President Doland Trump and Prime Minister Narendra Modi in February last year, a joint statement stated.

India(BHARAT) To Cut Tariffs On US Industrial, Food And Agricultural Goods

Under the new framework New Delhi will cut or reduce tariffs on all American industrial goods and agricultural products. This includes dried distillers’ grains, tree nuts, fresh/processed fruits, red sorghum for animal feed, soybean oil, wine and spirits, and other products.

US To Impose 18% Reciprocal Tariff On India(BHARAT)n Goods

According to the Joint Statement, Washington, under the relevant executive orders, will apply a reciprocal tariff of 18 percent on India(BHARAT)n goods. This will cover sectors like – artisanal products, textiles and apparel, plastics and rubber, organic chemicals, leather and footwear home decor, and machinery.

Benefits That Will India(BHARAT) Get From Interim Trade Framework

• Now, reciprocal tariffs will be reduced to 18 percent, improving market access for India(BHARAT)n exporters.
• Tariff cut on generic pharmaceuticals, gems & diamonds and aircraft parts.
• India(BHARAT)n exporters will get expanded entry into the US market. This will benefit MSMEs, farmers, fishermen, women.
• To boost to key export sectors like – leather and footwear, plastic and rubber products, organic chemicals, home decor and artisanal goods and select machinery.
• New Delhi will get exemptions under US Section 232 for aircraft parts.
• Preferential access for some auto components into America.
• Revised and improved terms and tariffs for India(BHARAT)n generic pharmaceuticals.
• No tariff concessions on maize, wheat, rice, soya, poultry, meat, milk, cheese (dairy), ethanol (fuel) and tobacco.

What India(BHARAT) Will Offer To US

• India(BHARAT) to cut tariffs on all US industrial goods and agricultural products. This includes DDGs, sorghum, nuts, fruits, soybean oil, wine and spirits.
• Sustained preferential market access in key sectors of interest.
• India(BHARAT) to buy USD 500 billion worth of US products. This include – energy, aircraft, precious metals, and technology products.
• The US and India(BHARAT) will set clear rules of origin, strengthen regulatory coordination, and widen market access as they continue talks on the broader bilateral trade agreement.
• Both countries to provide each other with preferential market access.