India-US interim trade agreement framework will boost Make in India and employment: Prime Minister Modi

New Delhi, February 7 (Agency). Prime Minister Narendra Modi, while welcoming the framework of the interim trade agreement between India and the US, termed it as a major and positive achievement for both countries. He said that this framework reflects the depth, trust, and dynamics of the India-US strategic partnership and will provide a new impetus to the 'Make in India' campaign.

Responding to a post by Union Commerce and Industry Minister Piyush Goyal on Instagram about the India-US interim trade agreement, Prime Minister Narendra Modi thanked US President Donald Trump for his personal contribution to strengthening the relationship between the two countries. The Prime Minister said that this interim trade agreement will open up new opportunities for farmers, industrialists, micro, small, and medium enterprises, start-up innovators, and fishermen, which will create massive employment opportunities in the country, especially for women and youth.

The Prime Minister said that this agreement will further deepen the investment and technology partnership between India and the US and strengthen the reliable and strong supply chain. He also said that it will not only benefit the economies of both countries but also accelerate global growth. Reiterating his vision of a developed India, the Prime Minister said that India is fully committed to global partnership for the future, which empowers people and promotes shared prosperity.

The Prime Minister termed it as the best news for both India and the US. He said that this framework will provide a new impetus to innovation, investment, and technical cooperation between the two countries and will further strengthen the global supply chain. He said that as India moves towards a developed India, it is committed to building global partnerships that put people at the center and contribute to shared growth worldwide.

Earlier, Union Commerce and Industry Minister Piyush Goyal termed the interim trade agreement between the two countries as a historic step for India's economy, exports, and employment. He said that under the decisive leadership of Prime Minister Narendra Modi, India has established this important framework with the US, which will open the doors to a vast American market worth $30 trillion for Indian exporters.

Piyush Goyal said that this agreement will particularly benefit micro, small, and medium enterprises, farmers, and fishermen, especially the large population. The increase in exports will create millions of new employment opportunities for women and youth. Under this framework, the US will reduce mutual tariffs on Indian products by up to 18%, which will lead to a significant increase in Indian exports in sectors such as textiles and apparel, leather and footwear, plastics and rubber, organic chemicals, home decor, handicrafts, and select machinery.

He said that tariffs on several products will also be completely eliminated, including generic medicines, jewelry, and diamonds, and aircraft parts. This will strengthen the 'Make in India' initiative and further strengthen India's export competitiveness. India has achieved favorable outcomes through negotiations on exemptions for aircraft parts under Section 232, tariff rate quotas on auto parts, and generic medicines, which will ensure export benefits in these sectors.

He said that the agreement fully protects the interests of farmers and rural economy. Under this, products such as corn, wheat, soybeans, poultry, milk, cheese, ethanol used as fuel, tobacco, some vegetables, meat, and other sensitive agricultural products have been fully protected.

Notably, India and the US issued a joint statement today about the framework of the interim trade agreement. The statement said that this move is a historic step towards promoting mutual, balanced, and mutually beneficial trade between the two countries. The statement termed it as a significant milestone towards taking the India-US economic partnership to new heights and towards a comprehensive bilateral trade agreement.

According to the joint statement, this framework is a significant milestone under the India-US bilateral trade agreement negotiations initiated by Prime Minister Narendra Modi and US President Donald Trump on February 13, 2025. These include products such as red sorghum for animal feed, dried distillers' grains, dried fruits, fresh and processed fruits, soybean oil, wine and spirits, and many others.

The US will impose a mutual tariff rate of up to 18% on Indian products, which will benefit sectors such as textiles and apparel, leather and footwear, plastics and rubber, organic chemicals, home decor, handicrafts, and select machinery. Tariffs on several products will also be completely eliminated, including generic medicines, jewelry and diamonds, and aircraft parts.

The joint statement said that the US will remove the tariff on Indian aircraft and aircraft parts imposed under the pretext of national security. This will pave the way for India to get a tariff rate quota on auto parts and achieve favorable outcomes on generic medicines under Section 232.

Both countries have also agreed to provide each other with preferential market access, establish clear rules of origin, and eliminate non-tariff barriers that affect bilateral trade. India has assured the removal of non-tariff barriers pending on US medical devices, ICT products, and agricultural products.

To strengthen the supply chain and enhance economic security, both countries have also agreed to increase cooperation on investment, export controls, and third-country non-market policies. According to the joint statement, India will purchase energy products worth approximately $500 billion from the US over the next five years, including aircraft and aircraft parts, precious metals, technology products, and cooking coal.

Two-way trade and technical cooperation in modern technology products, including GPUs used in data centers, will also be expanded. On digital trade, both countries have agreed to eliminate discriminatory and burdensome procedures and establish strong and balanced digital trade rules under the agreement.