In a landmark achievement for India’s global trade ambitions, the newly inked bilateral trade agreement with the United States promises unprecedented access to the world’s largest consumer market valued at $30 trillion. Announced by the Indian government on Monday, this comprehensive pact prioritizes Indian exporters by slashing tariffs on key goods, paving the way for boosted shipments across multiple sectors.
The deal ensures zero-duty exports for a wide array of products, fostering deeper collaboration in digital technologies and innovation between the two nations. Crucially, it incorporates robust safeguards for Indian farmers, MSMEs, and domestic industries, shielding them from unfair competition.
India’s exports to the US reached $86.35 billion in 2024, and this agreement is set to supercharge labor-intensive sectors like textiles, leather, gems and jewelry, agriculture, pharmaceuticals, and technology. Exporters in these areas stand to gain immensely from reduced barriers.
Under the terms, the US has slashed tariffs on $30.94 billion worth of Indian goods from 50% to 18%, and eliminated duties entirely on another $10.03 billion tranche. This opens doors to massive US sub-markets: textiles and apparel now access a $113 billion opportunity with tariffs down to 18%, while machinery exporters eye a whopping $477 billion arena.
The $42 billion US footwear market also beckons, with tariffs dropping from 50% to 18%, handing Indian producers a competitive edge. Importantly, India has secured complete protection for sensitive sectors including dairy, meat, poultry, and grains.
What makes this deal a game-changer is India’s enhanced competitiveness against rivals like China (hit with 37% US tariffs), Vietnam and Bangladesh (20% each), and Southeast Asian nations facing 19% duties. As Indian exporters gear up, this pact signals a new era of economic synergy between the two democracies, potentially reshaping global supply chains in India’s favor.