USISPF noted that such an agreement would address key issues, including tariffs, market access, non-tariff barriers and other trade-related concerns across multiple sectors. It added that a BTA between the two countries could deliver tangible benefits for businesses, workers and consumers, while also enhancing supply chain resilience and economic cooperation.
Market experts said the tariff cut materially improves India’s competitive positioning. Garima Kapoor, Deputy Head of Research and Economist at Elara Capital, said that based on the US President’s announcement, the policy-implied effective tariff rate on India could fall to 14.1% if Russia-related penalties are removed.”The 18% tariff brings India broadly in line with peers facing rates of around 20%. Removal of penalties linked to Russian oil could generate a positive tariff differential for India,” Kapoor said. She added that the development is “immensely positive for every Indian asset class”, with export sectors such as gems and jewellery, textiles and apparel, machinery and equipment, and automobiles likely to benefit the most.
The forum underlined that both governments have made it clear that the tariff reduction is only the beginning of a longer process, with additional phases of negotiations expected in the coming months. USISPF said it was encouraged by the constructive momentum generated by the latest announcement and remained optimistic about the scope and ambition of future talks.
Exporters welcomed the move but said further clarity was needed. Pawan Kumar G, President of the Seafood Exporters Association of India, called the development “great news” for the sector but urged caution. “This is something the industry has been waiting for, but we will have to wait for further details, especially as tariff relief appears linked to India stopping Russian oil purchases and increasing energy imports from the US to $500 billion,” he said. He added that despite the conditions, the move would bring significant relief to exporters.
Reiterating its commitment to supporting closer economic ties, USISPF said it would continue to work closely with both the Government of India and the US Government to advance the shared objective of expanding bilateral trade to $500 billion. The forum stressed that a stronger trade and investment relationship is critical not only for the two economies, but also for reinforcing a stable, resilient and rules-based Indo-Pacific.
Also read: India-US trade deal LIVE: Trump confirms pact, will lower tariffs immediately
