New Delhi: The United States has lifted the 50 percent reciprocal tariff imposed on several Indian agricultural products, including coffee, tea, spices, tropical fruits, and fruit juices. This rollback provides a major boost to Indian exporters, offering relief worth nearly USD 1 billion (around Rs 9,000 crore).
The tariff had earlier been imposed in response to India’s continued purchase of Russian oil. However, with food prices in the US steadily rising, the Trump administration found itself under pressure and has now stepped back from the restrictive measure.
Significant Relief for India’s Export Sector
According to India’s Commerce Ministry, which announced the development on November 17, the decision is expected to create a level playing field for Indian exporters. The Directorate General of Foreign Trade (DGFT) stated that high tariffs had made pricing uncompetitive for products such as spices and processed foods.
In FY25, India’s agricultural exports to the US totaled USD 2.5 billion (Rs 22,000 crore). Of this, nearly USD 1 billion worth of goods will now enter the American market duty-free, providing substantial market access and boosting growth in key segments.
India–US Trade Deal Approaches Final Stage
The lifting of tariffs comes at a time when India and the US are close to finalizing a comprehensive trade agreement. Commerce Secretary Rajesh Agarwal stated that discussions have made significant progress on issues such as US market access demands, India’s 25 percent reciprocal tariff, and the additional 25 percent duty on crude oil.
Talks on the trade deal have been ongoing since February this year and are now in their concluding phase.
India’s Strong Export Footprint in the US Market
India exported goods worth USD 86.51 billion (around Rs 7.66 lakh crore) to the US in FY25. The top five categories—textiles, jewelry, engineering goods, and others—contributed nearly USD 60 billion (Rs 5.3 lakh crore). However, the government estimates that high tariffs had impacted as much as USD 48.2 billion (Rs 4.3 lakh crore) of exports.
DGFT: Direct Gain of USD 1 Billion
DGFT Director General Ajay Bhadoo confirmed that the tariff rollback will directly benefit about USD 1 billion worth of agricultural exports. He noted that the decision will foster stronger growth in spices, processed foods, and other high-potential categories. The Commerce Ministry believes this move will also contribute to improving the overall trade balance between the two countries.
