Prime Minister Narendra Modi has welcomed the newly announced interim trade framework between India and the United States, describing it as a reflection of the “growing depth, trust and dynamism” in bilateral relations.
The Prime Minister said the agreement highlights US President Donald Trump’s “personal commitment to robust ties between our countries” and opens up fresh opportunities across multiple sectors of the Indian economy.
Under the framework, the United States will apply a reciprocal tariff rate of 18 per cent on Indian goods. The uniform rate places India in a comparatively stronger position than several countries in the region and provides a competitive advantage for Indian exporters.
Focus on employment, innovation and supply chains
In a post on X, PM Modi said the interim framework is expected to generate large-scale employment, particularly for women and young people. He added that the agreement would deepen cooperation in investment and technology while strengthening resilient and trusted supply chains.
According to the Prime Minister, both countries share a commitment to promoting innovation, and the framework would contribute to global economic growth by enhancing trade and industrial collaboration.
Key sectors set to benefit from tariff relief
The 18 per cent tariff rate is expected to support Indian exporters in sectors such as textiles, apparel, leather goods, chemicals and engineering products. The framework also strengthens India’s position against regional competitors that rely heavily on cost-based exports.
The agreement further opens a path to tariff removal on a wide range of Indian goods, including generic pharmaceuticals, gems and diamonds, and aircraft parts. These sectors already have a strong global presence and face steady demand in the US market.
Washington will also remove tariffs on certain Indian aircraft and aircraft components, while India will receive a preferential tariff rate quota for automotive parts. However, outcomes related to generic drugs and pharmaceutical ingredients will depend on the findings of a US Section 232 investigation.
Preferential market access beyond tariffs
Beyond tariff measures, both countries have agreed to provide preferential market access in sectors of sustained mutual interest, marking another step toward closer economic cooperation under the interim framework.