U.S. and India Announce Interim Trade Deal

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Feb. 9, 2026
By: Ashley J. Bodden

On February 6, the United States and India jointly announced an interim trade agreement aimed at expanding bilateral trade and reducing barriers between the two countries. The framework, outlined in a joint statement by President Trump and Prime Minister Narendra Modi, commits both nations to reciprocal tariff adjustments and expanded market access, while laying the foundation for a broader Bilateral Trade Agreement (BTA).

Although the interim agreement is still subject to final negotiation, both governments identified several key areas of cooperation:

1. Tariff Reduction: India will reduce or eliminate tariffs on a broad range of U.S. industrial, food, and agricultural products, including tree nuts, soybean oil wine, and spirits. The U.S. reduce reciprocal tariffs to 18 percent on select  Indian imports – such as textile, leather and footwear, plastic and rubber, organic chemicals – with plans to remove tariffs on goods such as generic pharmaceuticals, gems and diamonds, and aircraft parts.

2.    Market Access: Both countries have agreed to address non-tariff barriers and provide preferential market access in priority sectors, ranging from medical devices to information and communication technology goods.

3.    Supply Chain & Economic Alignment: The agreement emphasizes closer economic security coordination to strengthen supply chain. The two sides also have committed to addressing discriminatory or burdensome digital trade practices and enhancing innovation cooperation as part of the broader BTA framework.

4.    Trade Expansion: India has agreed to purchase $500 billion worth of U.S. goods over the next five years, including energy products, aircraft and aircraft parts, precious metals, technology products, and coking coal.

Officials from both countries have described the agreement as a “historic milestone” that balances mutual interests while preserving flexibility for future negotiations. Both governments stressed that the interim framework is a step toward a comprehensive Bilateral Trade Agreement, reaffirming commitments made when formal negotiations began in February 2025.

As the agreement gets finalized, please reach out to one of our attorneys at Barnes, Richardson & Colburn if you would to review the impact of the trade deal on your supply chain.