NEW DELHI: Prime Minister Narendra Modi on Saturday welcomed the India-US interim trade agreement, calling it a major step towards strengthening economic ties, boosting domestic manufacturing and creating jobs.In a post on X, PM Modi said: “Great news for India and USA! We have agreed on a framework for an Interim Trade Agreement between our two great nations. I thank President Trump for his personal commitment to robust ties between our countries. This framework reflects the growing depth, trust and dynamism of our partnership. It strengthens ‘Make in India’ by opening new opportunities for India’s hardworking farmers, entrepreneurs, MSMEs, StartUp innovators, fishermen and more. It will generate large-scale employment for women and youngsters. India and the United States share a commitment to promoting innovation and this framework will further deepen investment and technology partnerships between us. This framework will also strengthen resilient and trusted supply chains and contribute to global growth. As India moves forward towards building a Viksit Bharat, we remain committed to building global partner”. India and the United States earlier released a joint statement announcing the framework for an interim trade agreement, under which tariffs on Indian goods entering the US will be reduced from 50% to 18%. “The US and India are pleased to announce that they have reached a framework for an Interim Agreement regarding reciprocal and mutually beneficial trade,” the statement said.The announcement follows months of negotiations after trade talks stalled when Washington imposed 50% tariffs on Indian imports. Of these, 25% duties were introduced in August, with the US alleging that India was supporting Russia’s war efforts against Ukraine through oil purchases.The framework also reaffirms both sides’ commitment to negotiations on a broader US-India Bilateral Trade Agreement, launched by Modi and US President Donald Trump in February 2025 amid prolonged trade tensions linked to India’s energy imports from Russia.Under the interim deal, the United States will lower tariffs to 18% on a wide range of Indian products, including textiles and apparel, leather and footwear, plastic and rubber goods, organic chemicals, home décor, artisanal products and select machinery. Subject to the successful conclusion of the agreement, Washington has also said it will remove tariffs on additional Indian exports such as generic pharmaceuticals, gems and diamonds, and aircraft parts.India, in turn, will eliminate or reduce tariffs on all US industrial goods and a broad basket of food and agricultural products, including dried distillers’ grains, red sorghum for animal feed, tree nuts, fresh and processed fruit, soybean oil, wine and spirits.Union commerce and industry minister Piyush Goyal said the agreement protects India’s agriculture sector, with sensitive farm and dairy products fully safeguarded. These include maize, wheat, rice, soya, poultry, milk, cheese, ethanol for fuel, tobacco, certain vegetables and meat. The framework also outlines India’s intent to purchase $500 billion worth of US energy products, aircraft and aircraft parts, precious metals, technology products and coking coal over the next five years, a move expected to significantly expand bilateral trade.On claims that India would end Russian oil imports, New Delhi has not confirmed any such commitment. The government has reiterated that energy security remains its top priority. “Diversifying our energy sourcing in keeping with objective market conditions and evolving international dynamics is at the core of our strategy to ensure this,” MEA spokesperson Randhir Jaiswal said.The agreement provides for preferential market access for both countries in key sectors. The US will remove tariffs on certain Indian aircraft and aircraft parts imposed on national security grounds, while India will receive preferential tariff rate quotas for automotive parts and negotiated outcomes for generic pharmaceuticals and ingredients.Goyal said the pact opens up a $30 trillion market for Indian exporters, particularly MSMEs, farmers and fishermen, and is expected to create lakhs of jobs for women and youth.The framework also includes steps to boost digital and technology trade, with both sides committing to address barriers to digital commerce, increase trade in technology products including GPUs and data centre equipment, and expand joint technology cooperation.Both countries have agreed to work on removing non-tariff barriers affecting bilateral trade. India will address issues related to US medical devices, information and communication technology goods, and food and agricultural products, eliminate restrictive import licensing and review standards within six months to ease market access.Officials said the framework paves the way for finalising the interim agreement and advancing negotiations on a comprehensive bilateral trade agreement, with scope for further tariff reductions. Go to Source