Lok Sabha Question No. 4014 (UNSTARRED), answered on 2026-03-17
Subject: Impact of US Tariff on Economy
Ministry: COMMERCE AND INDUSTRY
Asked by: Shri Kalyan Banerjee

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE AND INDUSTRY DEPARTMENT OF COMMERCE

## LOK SABHA UNSTARRED QUESTION NO. 4014 ANSWERED ON 17/03/2026

## IMPACT OF US TARIFF ON ECONOMY

## 4014.  SHRI KALYAN BANERJEE:

Will the Minister of COMMERCE AND INDUSTRY ( वाणिज्य एवं उद्योग मंत्री ) be pleased to state:

- (a) the details of India-USA trade deal and commitment made with US and the details of sectors which are likely to be benefitted from this deal;
- (b) the details of India-US interim trade agreement tariff was proposed before the agreement by US Government for the reductions;
- (c) the details of zero duty items announced by US Government for the benefit of exporters, farmers and MSMEs thereof;
- (d) the details of items, those to be bought for 500 billion dollars that India has committed to purchase from US within 5 years, sector-wise;
- (e) whether any of Indo-China, Indo-Russia, Indo-Iraq, Indo-Saudi Arabia and the Indo United Arab Emirates (UAE) trade deals will affect the Indian economy, if so, the details thereof; and
- (f) the proposals of the Government to collect/arrange this committed additional 500 billion dollars under the present economy of the country, likely to impact the Indian economy in future?

## ANSWER

## वाणिज्य एवं उद्योग मंत्रालय में राज्यमंत्री ( श्री णिणिन प्रसाद ) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY (SHRI JITIN PRASADA)

(a)  to  (c)    (i)  India  and  the  United  States  (U.S.)  announced  a  trade  deal  on  2nd February  2026.  A  Joint  Statement  for  the  same  was  released  on  7th  February 2026.  On 7th February 2026, 25% additional ad valorem tariffs imposed by the U.S. on certain India's exports citing India's imports of Russian oil were removed. Subject to the conclusion of the Interim Agreement, the U.S. will provide preferential market access to Indian goods, including textile and apparel, leather and footwear, plastic and rubber, organic chemicals, home décor, artisanal products, certain machinery, etc. Further,  the  U.S.  will  reduce  additional  tariff  on  India  to  0%  on  a  wide  range  of products, such as gems and diamonds, aircraft parts, generic pharmaceuticals, certain machinery  and  parts,  vegetable  saps,  certain  instruments  and  apparatus,  certain plastic and rubber, certain auto parts, etc. The agreement will boost MSME exports in marine  products,  processed  food,  textiles,  leather,  and  handicrafts  by  providing preferential market access. India has fully protected its sensitive agricultural sectors through a carefully designed Exclusion Category, ensuring no tariff concessions on key agricultural products. Further information regarding the Interim Trade Deal is also

available at the following web-link:https://www.commerce.gov.in/wpcontent/uploads/2026/03/FTAs-achievement.pdf

(ii)  Pursuant  to  the  U.S.  Supreme  Court  judgement  dated  20 th   February  2026 invalidating  reciprocal  tariffs,  the  reciprocal  tariffs  are  no  longer  in  force.  The  U.S. Government has issued Executive Orders imposing 10% tariffs on certain products from  all  countries.  The  Government  is studying  all  the  developments  and  remains engaged with the US Government.

(d)  &  (f) India  is  one  of  the  fastest  growing  economies  with  rising  demand for  cost competitive,  reliable  and  diversified  sources  for  energy  products,  high  technology items to propel its domestic manufacturing, exports, innovation and integration with global supply chains. Accordingly, India intends to purchase energy products, aircraft and aircraft parts, Information and Communication technology (ICT) products, coking coal and other products worth $500 billion from the U.S. over the next 5 years.

(e) India signed the Comprehensive Economic Partnership Agreement (CEPA) with the United Arab Emirates on 18 February 2022, which entered into force on 1 May 2022. China became a member of the Asia-Pacific Trade Agreement (APTA) with effect from 1 January 2002, of which India is a founding member. Further, Iraq and India are members of the Global System of Trade Preferences (GSTP), which was signed on 13 April 1988 and entered into force on 19 April 1989. India currently does not  have  any  trade  agreement  with  Russia  or  Saudi  Arabia;  however,  Russia  is  a member  of  the  Eurasian  Economic  Union  (EAEU),  with  which  India  is  presently negotiating a trade agreement. Trade agreements are entered into with the concerned trading partner countries primarily with the aim to increase the bilateral trade through enlarging the scope of preferential market access and build on the trade complementarities for increasing trade and investment, thereby providing enhanced export  potential,  creating  benefits  for  industry  as  well  as  farmers  and  creating  job opportunities.

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