US, India Unveil Interim Trade Framework as Tariffs Ease and Cooperation Deepens

The United States and India have agreed on an interim trade framework that includes tariff reductions, major Indian purchases of US goods, and closer economic cooperation. The US will cut tariffs on Indian products, while India will lower duties on US industrial and agricultural goods, stop importing Russian oil, and expand defense ties. Both countries plan to finalize a full trade agreement in March.

The United States and India on Friday unveiled the framework for an interim trade agreement, marking another significant step in strengthening economic ties between the two countries. The development follows President Donald Trump’s earlier announcement that Washington and New Delhi had reached a trade deal after high-level discussions between both sides.
A joint statement released by the White House said the framework “reaffirms the countries’ commitment to the broader US–India Bilateral Trade Agreement (BTA) negotiations.” It emphasized that the interim arrangement is designed to build momentum toward a more comprehensive and long-term trade agreement, while addressing key tariff and market-access issues in the short term.
Under the terms outlined in the framework, India has agreed to eliminate or significantly reduce tariffs on all US industrial products. The agreement also covers a wide range of American food and agricultural goods, providing US exporters with greater access to the Indian market. These measures are expected to ease long-standing trade frictions and encourage increased bilateral trade flows.
In addition to tariff reductions, New Delhi has committed to purchasing around $500 billion (€423 billion) worth of US energy products, aircraft, and other goods over the next five years. This large-scale procurement is seen as a major boost for US industries, particularly in the energy and aviation sectors, while also helping India diversify its sources of supply.
Indian Prime Minister Narendra Modi welcomed the framework, stressing the shared commitment of both countries to innovation and economic growth. In a post on X, Modi said the agreement would further deepen investment ties and strengthen technology partnerships between India and the United States, reinforcing cooperation in emerging and strategic sectors.
The interim trade framework comes shortly after Trump announced on Monday that the United States had reached a trade deal with India. As part of that understanding, Washington agreed to reduce its so-called reciprocal tariffs on Indian goods to 18%, a move aimed at easing trade tensions and restoring balance in bilateral commerce.
On Friday, Trump also signed an executive order rescinding an additional punitive 25% duty that had been imposed on all imports from India. According to the executive order, India has committed to stopping the direct or indirect importation of oil from the Russian Federation. The document also stated that New Delhi is committed to working within a framework with the United States to expand defense cooperation over the next decade.
Previously, in August 2025, Trump had doubled duties on Indian goods in an effort to pressure New Delhi to halt its purchases of Russian oil. At that time, an extra 25% tariff was added on top of the existing 25% reciprocal duty, significantly raising the cost of Indian exports to the US market.
Looking ahead, both Washington and New Delhi are expected to formalize their cooperation by signing a comprehensive trade agreement in March. Indian Trade Minister Piyush Goyal said on Thursday that negotiations are progressing and that both sides remain confident a full trade deal will be concluded as planned.