The United States and India announced on Saturday a mutual interim trade agreement aimed at strengthening commercial relations. The terms of the agreement include India reducing tariffs on American industrial and food products in exchange for Washington imposing an 18% tariff on certain Indian goods. The two sides also agreed to lift security‑related tariffs on Indian aircraft and spare parts and to open tariff‑rate quotas for automobile parts. The agreement is expected to pave the way for a larger bilateral trade deal in the future.

A joint statement issued by Washington and New Delhi affirmed the two sides’ commitment to “continuing negotiations on the bilateral trade agreement,” which was launched by U.S. President Donald Trump and Indian Prime Minister Narendra Modi in February 2025.

The statement explained that “India will eliminate or reduce tariffs on all U.S. industrial goods, in addition to a wide range of food and agricultural products coming from the United States.”

In return, the statement noted that “the United States will impose reciprocal tariffs of 18% on certain Indian goods, with a commitment to later remove these tariffs on a number of other products.”

The statement also highlighted “an agreement to lift U.S. national‑security‑related tariffs on certain Indian aircraft and spare parts, along with granting India preferential tariff quotas for automobile parts.”

The two sides also agreed to “remove non‑tariff barriers, particularly in the sectors of medical devices, information and communications technology, and agricultural products, as part of efforts to enhance trade cooperation between the two countries.”