Commerce Minister Piyush Goyal confirmed Tuesday that a joint India-US statement will shortly formalise a landmark trade deal. By slashing tariffs from 50 percent to 18 percent, the agreement gives Indian exporters a price advantage over regional export rivals like China and Vietnam. While the commerce minister noted that the deal is in its “final stages” of detailing, he did not provide a specific timeline for the official release.
“As soon as the final understanding of the deal is inked and the joint statement is finalised, full details will be shared,” he said during a press conference, adding that technical processes are currently being completed. The agreement with Washington has been months in the making, following closely on the heels of the ‘mother of all’ trade deals recently inked between India and the EU.
The commerce minister emphasised that the new India-US trade deal safeguards sensitive domestic sectors, specifically shielding agriculture and dairy from external competition. He noted that while these critical industries remain protected, the 18 percent tariff reset unlocks massive export potential for labour-intensive sectors, including textiles, leather, plastics, apparel, gems and jewellery, home décor, rubber goods and aircraft components. The MSME sector also stands to gain from expanded access to the US market.
The tariff reduction is expected to deliver immediate relief to Indian exporters who have struggled under the weight of high US duties—the 50 percent tariffs imposed on India by the Trump administration last year were one of the highest in the world. Farmers, seafood exporters and the textile sector, in particular, have been significantly impacted by the earlier tariff regime. Under the new deal, these sectors are poised to see an uptick in competitiveness in the American market.
Beyond trade in goods, the deal also opens doors for investment in new and advanced technology sectors. Goyal highlighted that the agreement positions India to benefit from US investments in artificial intelligence, semiconductors, critical minerals and high-performance data centres.
The minister credited the personal rapport between Prime Minister Narendra Modi and President Donald Trump for helping bring the deal to fruition. He noted that India had secured a better deal than several neighbouring countries currently in negotiations with Washington, and congratulated President Trump for offering India one of the most competitive tariff arrangements among its peers.
On the question of why the tariff reduction was announced first by Trump, the minister said that “If America has to reduce the reciprocal tariffs from 50 percent to 18 percent, naturally the US President would give the information on tariff reductions first.”
On Sunday, US President Donald Trump announced on Truth Social that the United States and India had reached a long-awaited trade deal. Minutes later, Prime Minister Narendra Modi confirmed the deal on X.
The US President claimed that India had agreed to slash its own tariffs and non-tariff barriers against American goods to zero. He also said India had committed to significantly increasing purchases of US energy, agriculture and technology, with the PM reportedly pledging over $500 billion worth of American imports spanning energy, technology, agricultural products, coal and other goods.
An additional 25 percent tariff that had been imposed on India over its purchases of Russian oil was also dropped, with Trump stating that India had committed to halting Russian oil imports pivoting instead to sourcing energy from the United States and potentially Venezuela. However, Kremlin spokesman Dmitry Peskov stated on Tuesday that New Delhi has not communicated anything to Moscow about stopping Russian oil imports. And despite the India-USA trade deal’s claims, Russia says it intends to continue strengthening ties with India “in every possible way”.
While India now enjoys a competitive 18 percent US tariff rate the fallout from the earlier escalation lingers. Washington’s decision to impose 25 percent tariffs in April, later raised to 50 percent as punishment for buying Russian oil, sent India’s export share to the US into a sharp decline since mid-2025. Exports across smartphones, diamonds, medicines, shrimp and textiles took a significant hit. Some sectors showed signs of bouncing back in November, but others like diamonds and linen continue to struggle. India’s share in US imports has also slipped since April.
First Published: Feb 03, 2026, 19:44
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