Benchmarking its market access technique to product sensitivity, India will grant quota-based duty concessions within the car sector whereas providing market access to alcoholic drinks under tariff discount and minimal import price-based formulations under the commerce pact with the United States, the federal government mentioned on Monday, PTI reported. Under the settlement, tariffs on $30.94 billion of India’s exports will probably be decreased from 50 per cent to 18 per cent, whereas reciprocal tariffs on one other $10.03 billion will probably be eradicated.
“This means a substantial share of Indian goods entering the US market will now face either sharply lower tariffs or completely duty-free access, significantly improving price competitiveness,” the federal government mentioned.The authorities mentioned $1.36 billion of Indian agricultural exports will obtain zero extra US duty access. Key merchandise embody spices, tea, espresso, fruits, nuts and processed meals.
Sectoral features throughout textiles, gems, agriculture
Sensitive sectors equivalent to vehicles have been liberalised by means of a mixture of quota and duty discount mechanisms. According to an official, India isn’t granting any duty concessions on electrical automobiles to the US.Medical units have been positioned under lengthy and staggered phasing schedules, whereas treasured metals and different delicate industrial merchandise are being managed by means of quota-based tariff decreasing.“Alcoholic beverages have been offered under tariff reduction along with minimum import price-based formulations, consistent with India’s approach in other FTAs (free trade agreements),” it added.Listing sectoral features, the federal government mentioned tariffs on textile exports will probably be minimize from 50 per cent to 18 per cent, whereas silk will get nil duty access, opening alternatives within the US textile market valued at $113 billion.Tariffs for the home gems and jewelry sector may also fall to 18 per cent, offering preferential access to the US market valued at $61 billion.“In addition, 0 per cent duty market access has been secured for major product categories including diamonds, platinum and coins, covering a US market of $29 billion,” it added.Key export segments anticipated to realize embody minimize and polished diamonds, lab-grown artificial diamonds, colored gems, artificial stones and articles made from gold, silver and platinum.
Agri access structured by sensitivity, safety retained
India maintains a $1.3 billion commerce surplus in agricultural commerce with the US, with exports of $3.4 billion and imports of $2.1 billion in 2024, the federal government mentioned.The United States will apply zero extra duty on Indian exports price $1.36 billion. Beneficiary gadgets embody spices, tea, espresso, copra, coconut oil, cashew nuts, chestnuts, avocados, bananas, guavas, mangoes, kiwis, papayas, pineapples and mushrooms.Cereals equivalent to barley and canary seeds, bakery merchandise, cocoa and cocoa preparations, sesame and poppy seeds, and processed meals merchandise equivalent to fruit pulp, juices and jams may also profit.In line with India’s present FTA method, agricultural market access has been structured based mostly on product sensitivity, together with fast duty elimination, phased elimination of as much as 10 years, tariff discount, margin of choice and tariff charge quota mechanisms.Highly delicate agricultural sectors stay totally protected under an exemption class. These embody meat, poultry, dairy merchandise, GM meals merchandise, soyameal, maize and cereals.For choose delicate merchandise, tariff discount has been utilized to keep up measured duty safety. Examples embody plant components, olives, pyrethrum and oil muffins.Certain extremely delicate gadgets have been liberalised under tariff charge quotas (TRQs), permitting restricted portions at decreased duties. These embody in-shell almonds, walnuts, pistachios and lentils.Phased tariff elimination of as much as 10 years has been provided for sure intermediate meals processing inputs sourced from a number of nations, together with albumins, coconut oil, castor oil, cotton seed oil and plant derivatives.“Immediate duty elimination has been offered only for select non-sensitive products that are already liberalised under other FTAs,” it mentioned.
Industrial items and digital commerce framework
For industrial items, the settlement secures zero extra duty access for exports valued at $38 billion, the federal government mentioned.India will get zero reciprocal duty access in key industrial classes together with gems and diamonds, platinum and cash, clocks and watches, important oils, inorganic chemical substances, paper articles, plastics, wooden merchandise and pure rubber.Market access for American industrial items has been structured strictly based mostly on product sensitivity, combining fast tariff elimination, phased discount of as much as 10 years and quota-based access.In digital commerce, India’s digitally delivered companies exports stood at $0.28 trillion in 2024, rising 10.3 per cent year-on-year.India ranks fifth globally in digitally delivered companies exports and eleventh in imports, whereas the US ranks first in each classes.“A structured digital trade framework between the two countries reduces regulatory uncertainty, lowers compliance friction and facilitates smoother cross-border service delivery,” the federal government mentioned.
