On February 6, 2026, the United States and India announced a framework for an Interim Agreement on reciprocal and mutually beneficial trade, marking a step toward a broader bilateral trade agreement (BTA). The announcement comes on the heels of a social media post earlier in the week in which U.S. President Trump reported the trade agreement following a discussion with India Prime Minister Modi. The White House has released a joint statement and fact sheet outlining the terms of the framework.
Among the defining features of the framework is India’s commitment to eliminate or reduce tariffs on all U.S. industrial goods and wide-ranging agricultural and food products, including distillers’ grains, tree nuts, soybean oil, fruits, and wine and spirits.
For its part, the United States will reduce its reciprocal tariff rate from 25% to 18% across a broad array of Indian imports, including textile and apparel, leather and footwear, plastic and rubber, organic chemicals, home décor, artisanal products, and certain machinery. The announcement does not provide the effective date for these tariff reductions, but we understand that the U.S. Trade Representative has indicated that the Federal Register publication implementing the reductions is forthcoming. Until that occurs and an effective date is provided, the 25% tariff rate remains in effect.
The framework also states that the United States will rescind the 25% tariff imposed on Indian goods, in recognition of India’s commitment to cease purchasing Russian oil. President Trump formalized this change by an executive order of the same date as the framework announcement. The tariff that was imposed under the International Economic Emergency Powers Act (the legality of which is currently under review by the U.S. Supreme Court) will no longer apply to goods entered for consumption, or withdrawn from the warehouse for consumption, on or after 12:01 a.m. EST on February 7. Refunds on duties collected on entries made after this time will be processed in accordance with standard CBP procedures. The executive order further indicates that the United States will continue to monitor Indian trade in Russian oil and may reimpose the tariff if India resumes its reliance on Russian oil.
The United States will remove tariffs on numerous additional Indian goods, including generic pharmaceuticals, gems and diamonds, and aircraft parts, subject to the finalization of the agreement. Further, Indian imports will benefit from adjustments to sectoral tariffs imposed under Section 232, including preferential tariff-rate quotas for automotive parts. Indian generic pharmaceuticals and ingredients will be subject to “negotiated outcomes”, contingent on the findings of a Section 232 investigation into the national security impacts of imports of such goods. Going forward, the countries will also afford each other preferential market access in sectors of interest and will establish mutually beneficial rules of origin.
The framework also signals a commitment to address non-tariff barriers affecting bilateral U.S.-India trade. To this end, both countries have agreed to determine whether U.S.-developed or international standards are acceptable for the entry of U.S. goods into India in certain sectors. India will also address barriers to trade in U.S. medical devices, end licensing requirements that stymie market access for U.S. information and communication technology (ICT) equipment, and remove barriers to digital trade. India has additionally committed to increased purchases of U.S. goods, including $500 billion worth of U.S. energy products, aircraft and aircraft parts, precious metals, technology products, and coking coal.
The Interim Agreement establishes the structural foundation for concluding a broader BTA. Upcoming negotiations will address remaining tariff barriers, non‑tariff barriers, technical barriers to trade, customs and trade facilitation, intellectual property, labor, environmental issues, and state‑owned‑enterprise practices. Both sides have signaled their intent to implement the framework promptly, finalize the Interim Agreement, and lock in long‑term trade benefits.
