India vs USA Trade Deal: The long-standing trade tensions between India and the United States have finally reached a positive turning point. Under the leadership of Prime Minister Narendra Modi, India has approved the framework of a strong Interim Trade Agreement with the US. Under this agreement, the United States has agreed to reduce tariffs on Indian products from 50% to 18%. In addition, President Donald Trump has signed an executive order removing the 25% punitive tariff imposed on India due to its purchase of Russian oil—an action seen as a historic victory for Indian exporters.

Union Commerce Minister Piyush Goyal stated that this framework will open the doors of the $30 trillion US market to Indian exporters, especially MSMEs and artisans. Tariffs on products such as textiles, leather, footwear, and handicrafts have been reduced, while tariffs on gems and jewellery, pharmaceuticals, and aircraft parts will be brought down to zero. This agreement is expected to accelerate the “Make in India” initiative and create millions of employment opportunities.

Most importantly, the agreement fully safeguards the interests of Indian farmers and the dairy sector. India has kept sensitive agricultural products such as corn, wheat, rice, soybeans, poultry, milk, and cheese outside the scope of the deal. In return, India has committed to purchasing oil, gas, and technology products from the US. According to President Trump, India will reduce its oil imports from Russia, shift towards the US and Venezuela, and is expected to purchase around $500 billion worth of American goods over the next five years.

Both countries will continue discussions on non-tariff barriers, data center technology, and other strategic issues. Piyush Goyal has indicated that the interim agreement will be converted into a formal legal treaty by March. This deal is not only economically significant but also strategically important, positioning India as a strong global alternative to China.

Protected Sectors and Products

The agreement strongly reflects India’s commitment to protecting farmers’ interests. The following sensitive agricultural and dairy products are fully safeguarded:

• Agriculture & Dairy: Corn, wheat, rice, soybeans, poultry, milk, cheese, ethanol (fuel), tobacco, and selected vegetables
• Grains: Wheat, copra, millets (including foxtail millet, kodo millet, barnyard millet, sorghum, pearl millet), oats, maize, barley, rice, and corn
• Vegetables: Onion, potato, peas, beans, mushroom, ridge gourd, tindora, okra, pumpkin, garlic, cucumber, capsicum, chickpeas, sweet potato
• Fruits: Banana, mango, strawberry, processed cherry, dried plums, dried apples, tamarind, water chestnut, dry fruits, oranges, mandarin, grapefruit, lemon, grapes
• Dairy Products: Milk, cream, yogurt, buttermilk, butter, ghee, cheese, butter oil, paneer, and other dairy products
• Spices: Black pepper, cloves, dried green chillies, cinnamon, coriander, cumin, asafoetida, ginger, turmeric, ajwain, fenugreek, fennel, mustard, and all powdered spices

These protections ensure that local farmers, dairy producers, and domestic markets remain secure, while India simultaneously expands its global trade presence.