White House Releases United States-India Joint Statement
The United States and India have announced a significant framework for an Interim Agreement aimed at strengthening bilateral trade. This agreement signifies a mutual commitment to enhance trade relations and establish a more resilient supply chain between the two countries.
Framework for Interim Agreement
Launched by President Donald Trump and Prime Minister Narendra Modi on February 13, 2025, the framework sets the stage for broader U.S.-India Bilateral Trade Agreement (BTA) negotiations. It highlights essential aspects such as reciprocal and balanced trade that benefits both nations.
Key Terms of the Interim Agreement
- India will reduce tariffs on various U.S. industrial goods, including:
- Dried distillers’ grains
- Red sorghum
- Tree nuts
- Fresh and processed fruit
- Soybean oil
- Wine and spirits
- The U.S. will institute an 18% reciprocal tariff on specific Indian goods, impacting sectors such as:
- Textile and apparel
- Leather and footwear
- Organic chemicals
- Machinery
- Tariffs on Indian aircraft and parts will be removed to address national security concerns.
- India will receive a preferential tariff rate quota for automotive parts.
- Negotiated outcomes regarding generic pharmaceuticals are contingent upon the U.S. Section 232 investigation findings.
Addressing Non-Tariff Barriers
The agreement aims to tackle longstanding non-tariff barriers affecting bilateral trade. Key commitments include:
- India will streamline import licensing procedures for U.S. medical devices and ICT goods.
- Standards for U.S. exports entering India will be reviewed within six months of the agreement’s implementation.
Future Trade and Economic Goals
Both nations are focused on enhancing market access in specific sectors. The U.S. will consider India’s requests to reduce tariffs on Indian goods during BTA negotiations. A notable economic target includes India’s plan to purchase $500 billion in U.S. energy products and advanced technology over the next five years.
Commitment to Digital Trade
To promote digital trade, the U.S. and India will work to eliminate burdensome practices. They aim to establish robust digital trade rules as part of the broader BTA framework.
In summary, the United States-India Joint Statement lays the groundwork for a mutually beneficial trade relationship, with a focus on market access, supply chain resilience, and addressing existing barriers. The swift implementation of this framework is anticipated to foster a strengthened economic partnership between the two countries.
