India Set to Operationalise Major Trade Agreements with US, UK, and Other Nations
India is poised to activate its recently signed trade deals with the United States, the United Kingdom, and several other countries in the coming months. This development marks a significant step forward in India's international trade relations, with multiple agreements scheduled for implementation starting as early as April.
Timeline and Details of the Trade Pacts
Union Commerce and Industry Minister Piyush Goyal announced on Friday that the interim trade agreement with the United States is expected to come into effect in April. This follows the announcement earlier this month that India and the US had reached an interim trade deal, which is scheduled for formalisation in March. To finalise the legal text of this agreement, officials from both countries will meet for three days starting February 23, building on months of negotiations.
In addition to the US pact, Minister Goyal confirmed that other free trade agreements with the United Kingdom and Oman might also materialise in April. Meanwhile, a similar trade pact with New Zealand is scheduled for implementation in September, expanding India's global trade footprint across multiple regions.
Key Provisions of the US-India Trade Deal
Under the interim trade agreement with the United States, reciprocal tariffs on India have been reduced from 50% to 18%. This reduction comes after the Trump administration had imposed a 50% tariff on Indian exports, including a 25% levy, citing India's purchase of Russian crude as indirectly supporting Moscow's "war machine" against Ukraine. In return, India has committed to lowering tariffs on US products, facilitating smoother trade flows between the two nations.
Minister Piyush Goyal emphasised that the trade pact is designed to protect farmers and the agricultural sector. He highlighted the opportunities it offers for farmers, fishermen, and micro, small, and medium enterprises to access the $30 trillion US market. The formal agreement could be signed by March, after which India's tariff reductions on US exports would come into effect, boosting bilateral economic ties.
Broader Implications and Strategic Moves
This series of trade agreements underscores India's proactive approach to enhancing its global trade partnerships. The deals are expected to stimulate economic growth, create jobs, and provide new avenues for Indian businesses in international markets. Furthermore, India also entered the US-Led Pax Silica on Friday, aligning with broader strategic initiatives in the global trade arena.
Welcoming the trade framework, Minister Goyal reiterated its benefits for various sectors, ensuring that the agreements are balanced and favourable for India's domestic industries. The operationalisation of these pacts starting in April represents a critical milestone in India's trade diplomacy, potentially setting the stage for more comprehensive agreements in the future.
