TNI Bureau: The United States and India have announced a framework for an Interim Trade Agreement aimed at boosting bilateral trade and strengthening economic ties.

The framework reaffirms both countries’ commitment to negotiating a broader U.S.-India Bilateral Trade Agreement (BTA), launched by U.S. President Donald Trump and Indian Prime Minister Narendra Modi in February 2025. The Interim Agreement is expected to improve market access, promote balanced trade, and support more resilient supply chains.

Under the framework, India will eliminate or reduce tariffs on all U.S. industrial goods and a wide range of agricultural products, including animal feed, fruits, nuts, soybean oil, wine, and spirits.

The United States will apply a reciprocal tariff rate of 18 percent on certain Indian goods, including textiles, apparel, leather, footwear, chemicals, and machinery, but will remove tariffs on a wide range of products such as generic pharmaceuticals, gems and diamonds, and aircraft parts, subject to the successful conclusion of the agreement.

Both countries will also remove or reduce national security-related tariffs on select goods, including aircraft and aircraft parts, and provide preferential tariff treatment for automotive parts. India will receive negotiated outcomes on generic pharmaceuticals, subject to the findings of a U.S. investigation.

The agreement includes commitments to address non-tariff barriers, improve access for medical devices, ICT products, and agricultural goods, and align standards and conformity assessment procedures.

India has also expressed its intention to purchase $500 billion worth of U.S. energy, aircraft, technology products, precious metals, and coking coal over the next five years. Both sides will expand cooperation in advanced technologies, including data center equipment such as GPUs.

The two countries also agreed to strengthen supply chain resilience, improve digital trade rules, and work toward finalizing a comprehensive Bilateral Trade Agreement.