$44 billion exports to get zero reciprocal tariffs: Goyal on India-US trade pact
The minister said the tariff reductions would immediately benefit labour-intensive industries such as textiles, apparel, leather and footwear.
The minister said the tariff reductions would immediately benefit labour-intensive industries such as textiles, apparel, leather and footwear.
The minister said the tariff reductions would immediately benefit labour-intensive industries such as textiles, apparel, leather and footwear.
New Delhi: Commerce and Industry Minister Piyush Goyal on Saturday said that Indian exports worth nearly USD 44 billion will enjoy zero reciprocal tariffs in the US market under the first phase of the proposed bilateral trade agreement, which is likely to be signed by mid-March.
India and the US have reached a framework for an interim trade pact aimed at reducing import duties on several products to enhance bilateral trade. Under the agreement, the US will lower tariffs on Indian goods from 50 per cent to 18 per cent, while India will either remove or reduce duties on all American industrial products and a wide range of agricultural and food items.
These include dried distillers’ grains, red sorghum for animal feed, tree nuts, fresh and processed fruits, soybean oil, wine and spirits.
Goyal said that around USD 44 billion worth of Indian exports will enter the US market without reciprocal duties. About USD 30 billion worth of goods, largely from labour-intensive sectors, will continue to face an 18 per cent tariff, while duties on goods worth USD 12 billion, including steel, copper and certain auto components, will remain unchanged.
He explained that tariffs on steel, aluminium, copper and auto parts are applied uniformly to all countries and therefore do not affect India’s competitive position, even though these products face a 50 per cent levy in the US.
In 2024-25, bilateral trade between the two countries reached USD 186 billion, with exports at USD 86.5 billion and imports at USD 45.3 billion. India recorded a trade surplus of USD 41 billion during the year.
The minister said the tariff reductions would immediately benefit labour-intensive industries such as textiles, apparel, leather and footwear.
He added that the interim agreement would soon form the first phase of a comprehensive bilateral trade agreement and help both nations move towards the USD 500 billion trade target by 2030.
Calling the deal fair and balanced, Goyal said it would significantly cut US reciprocal tariffs on Indian products. An executive order to reduce the tariffs from 25 per cent to 18 per cent is expected soon.
He also noted that several Indian products, including generic medicines, aircraft parts and auto components, would receive zero-duty access.
According to Goyal, the agreement would unlock major opportunities in the USD 30 trillion US market and benefit MSMEs, farmers, fishermen, youth and women entrepreneurs.
He said farmers and fishermen would get better prices for their produce, while sectors such as textiles, gems and jewellery, machinery, toys, leather goods, home décor, smartphones and agriculture are expected to see strong growth.
Goyal stressed that India has protected sensitive sectors and has not offered duty concessions on items such as meat, dairy products, GM foods, cereals, millets, fruits, pulses, oilseeds, honey, beverages, ethanol and tobacco.
The pact is also expected to create opportunities in emerging sectors such as data centres, artificial intelligence and quantum computing, as India will gain access to advanced equipment, semiconductors, ICT products, machinery, pharmaceuticals and medical devices.
He said the US is a leading global supplier in these areas, making the agreement especially beneficial for India.