India-US interim trade pact to spur jobs and strengthen Make in India, says PM Modi

Prime Minister Narendra Modi on February 7 welcomed a landmark interim trade framework between India and the United States, calling it a strong signal of deepening trust, cooperation and strategic alignment between the two countries.

Announcing the agreement in a post on X, Modi said India and the US had reached a framework for an Interim Trade Agreement after months of negotiations and thanked US President Donald Trump for personally driving the talks forward.

“We have agreed on a framework for an Interim Trade Agreement between our two great nations,” Modi wrote. “I thank President Trump for his personal commitment to robust ties between our countries.”

Describing the framework as a reflection of the “depth, trust and dynamism” of the India–US partnership, the Prime Minister said the pact would support India’s domestic growth agenda and strengthen the government’s flagship Make in India programme.

Modi said the agreement would open up new opportunities for farmers, entrepreneurs, small businesses, start-ups, fishermen and innovators, while generating large-scale employment for women and young people.

“It will generate large-scale employment for women and youngsters,” he said, underlining the deal’s potential to create inclusive growth.

The Prime Minister also highlighted the shared focus of both countries on innovation, saying the framework would deepen investment and technology partnerships, particularly in advanced and emerging sectors. He added that the agreement would help build resilient and trusted supply chains and contribute to global economic growth.

“As India moves forward towards building a Viksit Bharat, we remain committed to building global partnerships that are future-oriented, empower our people and contribute to shared prosperity,” Modi said.

The interim framework is the outcome of broader negotiations under the proposed US–India Bilateral Trade Agreement, talks for which were launched in February 2025.

Under the proposed arrangement, India has agreed to eliminate or reduce tariffs on several US industrial goods and cut duties on a wide range of American farm and food products, including animal feed, nuts, fruits, soybean oil, wine and spirits. New Delhi has also committed to addressing non-tariff barriers affecting US medical devices, information and communications technology goods, and agricultural imports.

In return, the United States will apply a reciprocal tariff rate of 18% on Indian exports such as textiles, clothing, leather, footwear and machinery. Washington has also agreed to remove tariffs on select products, including certain aircraft and aircraft parts, generic pharmaceuticals, and gems and diamonds.

India has indicated plans to purchase around $500 billion worth of US goods over the next five years, spanning energy products, aircraft, precious metals, technology equipment and coking coal.

Both sides have said the interim framework will be implemented swiftly, even as negotiations continue toward a comprehensive and mutually beneficial trade agreement.