Mumbai: India and the US released a joint statement on Saturday stating that they have established an interim agreement regarding reciprocal trade.
Responding to the development on X(formerly Twitter), External Affairs Minister S Jaishankar said that the framework for an interim agreement will release a mutually beneficial India-US trade partnership.
"The framework will ensure greater market access and opportunities for our exporters. New vistas have opened up that will further promote Make in India," the external affairs minister said further.
The India-US joint statement is largely seen as a historic milestone driven by mutual interests and concrete outcomes. The statement takes into consideration the economic security of both nations.
The key terms of the agreement include India's tariff reduction on US industrial goods and a wide range of US food and agricultural products.
The US will apply a reciprocal tariff rate of 18% on Indian textiles and apparel, leather and footwear, plastic, rubber, home decor, artisanal products and machinery. Significantly, this new tariff rate is way below the punitive 50% tariff rate that was imposed earlier as a result of India continuing to buy Russia oil despite US pressure.
With the new reducted tariif rate, Indian exporters will breathe a sigh of relief as it allows much broader leeway to send their products beyond the country's borders.
In an important boost to India's military aviation sector, the US has decided to eliminate tariffs on certain Indian aircraft and aircraft parts, highlighting national security concerns.
It also stated that India and the US will work towards expanding market access opportunities through BTA negotiations.
