India and the US move closer to reducing Trump tariffs
[February 07, 2026] By
AIJAZ HUSSAIN
NEW DELHI (AP) — India and the United States released a framework for an
interim trade agreement to lower tariffs on Indian goods, which Indian
opposition accused of favoring Washington.
The joint statement, released Friday, came after U.S. President Donald
Trump announced his plan last week to reduce import tariffs on the South
Asian country, six months after imposing steep taxes to press New Delhi
to cut its reliance on cheap Russian crude.
Under the deal, tariffs on goods from India would be lowered to 18%,
from 25%, after Indian Prime Minister Narendra Modi agreed to stop
buying Russian oil, Trump had said.
The two countries called the agreement “reciprocal and mutually
beneficial” and expressed commitment to work toward a broader trade deal
that “will include additional market access commitments and support more
resilient supply chains.” The framework said that more negotiations will
be needed to formalize the agreement.
India would also “eliminate or reduce tariffs” on all U.S. industrial
goods and a wide range of food and agricultural products, Friday's
statement said.
The U.S. president had said that India would start to reduce its import
taxes on U.S. goods to zero and buy $500 billion worth of American
products over five years, part of the Trump administration’s bid to seek
greater market access and zero tariffs on almost all American exports.
Trump also signed an executive order on Friday to revoke a separate 25%
tariff on Indian goods he imposed last year.
Indian Prime Minister Narendra Modi thanked Trump “for his personal
commitment to robust ties.”
“This framework reflects the growing depth, trust and dynamism of our
partnership,” Modi said on social media, adding it will “further deepen
investment and technology partnerships between us.”
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Indian Minister of Commerce and Industry Piyush Goyal makes a press
statement on the completion of India-US tariff in New Delhi, India,
Tuesday, Feb. 3, 2026. (AP Photo/Manish Swarup)
 India’s opposition political parties
have largely criticized the deal, saying it heavily favors the U.S.
and negatively impacts sensitive sectors such as agriculture. In the
past, New Delhi had opposed tariffs on sectors such as agriculture
and dairy, which employ the bulk of the country’s population.
Meanwhile, Piyush Goyal, Indian Trade Minister, said the deal
protects “sensitive agricultural and dairy products” including
maize, wheat, rice, ethanol, tobacco, and some vegetables.
“This (agreement) will open a $30 trillion market for Indian
exporters,” Goyal said in a social media post, referring to the U.S.
annual GDP. He said the increase in exports was likely to create
hundreds of thousands of new job opportunities.
Goyal also said tariffs will go down to zero on a wide range of
Indian goods exported to the U.S., including generic
pharmaceuticals, gems and diamonds, and aircraft parts, further
enhancing the country's export competitiveness.
India and the European Union recently reached a free trade agreement
that could affect as many as 2 billion people after nearly two
decades of negotiations. That deal would enable free trade on almost
all goods between the EU’s 27 members and India, covering everything
from textiles to medicines, and bringing down high import taxes for
European wine and cars.
India also signed a comprehensive economic partnership agreement
with Oman in December and concluded talks for a free trade deal with
New Zealand.
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