New Delhi / Washington — February 12, 2026
India and the United States have agreed on a framework for an interim trade deal, marking a significant step in economic cooperation between the two countries. The framework aims to reduce long-standing trade barriers and strengthen bilateral commerce ahead of a full comprehensive trade agreement.

Under the interim agreement, the United States will reduce reciprocal tariffs on many Indian exports to about 18% from earlier levels near 50% across several product categories, including textiles, apparel, chemicals, and home décor. The move is expected to improve the competitiveness of Indian goods in the US market.

The deal also provides for increased cooperation in trade, technology, digital services, and supply chain resilience. Both sides have reaffirmed their commitment to continue negotiations toward a broader Bilateral Trade Agreement (BTA).

Economic Benefits and Sector Impact
Tariff reductions are expected to open new opportunities for Indian exporters, especially in textiles, leather goods, and MSME sectors. Industry bodies have responded positively, though detailed implementation guidelines are still being finalized. Officials have indicated that the legal form of the interim pact is targeted for completion by March 2026.

Political and Public Response
US President Donald Trump called the agreement “historic,” highlighting expanded trade and export opportunities. In India, however, farmer groups and unions have staged protests, expressing concern that future provisions could expose domestic agriculture to subsidized US imports. The Indian government has stated that sensitive sectors such as dairy, rice, and poultry remain protected.
 

What’s Next
Officials describe the arrangement as an interim framework, forming the base for a more comprehensive and legally binding trade agreement. Further negotiations are expected in the coming weeks.

Reference Links:
Reuters: https://www.reuters.com/world/india/around-90-95-indian-farm-products-kept-out-us-deal-indian-trade-minister-says-2026-02-12/
Economic Times: https://m.economictimes.com/news/economy/foreign-trade/india-aims-to-sign-interim-trade-deal-legal-pact-with-us-by-march-end-commerce-secy-rajesh-agrawal/articleshow/128220322.cms
Times of India: https://timesofindia.indiatimes.com/business/india-business/historic-deal-donald-trump-hails-india-us-trade-agreement/articleshow/128228403.cms