US-India Trade Deal: Everything You Need to Know

While the Indian government hails the recent India-US trade deal as a major achievement, opposition parties continue to raise questions about its details. Here’s what is currently known and what remains uncertain.

Key Provisions of the Deal
U.S. President Donald Trump announced that tariffs on Indian exports to the U.S. will drop from 50% to 18%. Commerce and Agriculture Minister Piyush Goyal clarified that sensitive sectors, particularly agriculture and dairy, will remain protected.

Implementation Timeline
Trump indicated that the 18% tariff reduction would take effect immediately, but formal government orders are still required under U.S. regulations. According to Indian officials, technical teams from both countries are finalizing the details. A joint statement will clarify the official timeline once a “final understanding” is reached.

What Happened to the 25% Oil Penalty?
In April, the U.S. had imposed a 25% penalty on India for purchasing Russian oil, raising the total tariff to 50%. The trade deal now removes this penalty, bringing the base tariff down to 18%.

Zero Tariff on U.S. Goods?
Trump has hinted at zero tariffs on certain U.S. products, but details on which items and when the reduction will apply remain unclear. Indications suggest that industrial goods may see faster tariff cuts, while sensitive sectors will remain protected.

$500 Billion Purchase Commitment
Trump claimed that India would purchase $500 billion worth of U.S. goods. Indian officials clarified that this figure would be achieved over 5–6 years once the deal is fully implemented.

Agriculture and Dairy Protections
While the U.S. seeks greater access for its agricultural exports, India has emphasized that sensitive sectors like GM crops and dairy will remain protected. Certain items, such as soy and almonds, may receive exemptions.

The deal is being positioned as a milestone in India-US trade relations, but experts note that many questions regarding tariffs, exemptions, and implementation timelines remain to be clarified.