The India-US trade deal has been officially finalized following a historic call between President Trump and Prime Minister Modi on February 3, 2026. As reported by The Sunday Guardian, President Trump announced the agreement in a social media post, calling it an 'honour' to speak to PM Modi about the White House finally agreeing to a mutually acceptable trade agreement. The deal represents a significant breakthrough after months of negotiations, with both leaders handling the principals-level discussions themselves. Prime Minister Modi responded immediately on social media about his 'good friend President Donald Trump' having spoken about the agreed trade framework, marking the end of the logjam that had threatened the US-India partnership.
The India-US trade deal has significantly expanded market access for American agricultural products, as confirmed by the United States Trade Representative (USTR). According to the USTR statement, the agreement provides new market access for US products ranging from nuts and dried distilled grains (DDG) to red sorghum and fresh and processed fruits. The deal represents a major breakthrough for American farmers and producers seeking to tap into one of the world's largest economies. As per the USTR, President Trump is expanding access for American farmers and producers to one of the world's largest economies, with India committing to eliminate or reduce tariffs on a wide range of all US industrial goods and agricultural products. Union Agriculture Minister Shivraj Singh Chouhan confirmed that farmers' interests are fully protected under the agreement, with no genetically modified products being imported and key agricultural products like basmati, rice, spices, and textiles remaining excluded from the deal.
The US and India have agreed on an interim trade framework that will reduce US tariffs on Indian goods to 18 per cent, as reported by ET Now. According to the joint statement issued by the White House, both countries have reached a framework for an Interim Agreement regarding reciprocal and mutually beneficial trade. The deal reaffirms commitment to a broader bilateral trade agreement and deeper market access, with negotiations launched by US President Donald J. Trump and Prime Minister Narendra Modi on February 13, 2025. Commerce Minister Piyush Goyal announced that the India-US trade agreement framework will give Indian exporters access to a $30 trillion market, benefiting MSMEs, farmers and fishermen and creating lakhs of jobs for women and youth. India has granted US selective market access under the new trade agreement, allowing duty-free entry for products like animal feed, certain wines, and computer components. India's exports of about $44 billion to the US will enter the American market at zero reciprocal tariffs under the first phase of the BTA, which is expected to be signed by mid-March.
The India-US trade deal announcement triggered an immediate market surge, with the share market booming and gaining ₹13 lakh crores by the morning of February 3 following President Trump's announcement. As reported by The Sunday Guardian, the market rally came as a surprise to traders who had been betting against India, with the positive response showing that betting against the fastest growing major economy was a mistake. The deal is expected to strengthen the Indian economy and raise the GDP of India perhaps to the long awaited double digit level, with both countries benefiting from the comprehensive partnership. The agreement represents a historic milestone in bilateral partnership, demonstrating common commitment to reciprocal and balanced trade based on mutual interests, with both countries working toward a comprehensive bilateral trade agreement that will provide further benefits to US-linked Indian companies across various sectors.
Pharmaceutical companies are expected to see significant impact from the trade deal, with several major players deriving over 50 per cent of their revenues from the US market. NATCO Pharma generated approximately ₹3,149 crore ($374 million) from the US in FY2025, accounting for 65.8 per cent of total consolidated revenue of ₹4,784 crore. Gland Pharma derives 53-55 per cent of its revenue from the US driven by a broad portfolio of ANDAs, while Biocon contributes 46 per cent of its revenue from the US market, remaining its largest market. Technology companies with significant US exposure are also positioned for potential benefits, with Persistent Systems generating approximately 80 per cent of its revenue from North America in fiscal 2026, and Mphasis deriving 83 per cent of its total revenue from the US market.
The India-US trade deal could prove to be a game-changer for several sectors, as reported by ET Now. The agreement represents a historic milestone in bilateral partnership, demonstrating common commitment to reciprocal and balanced trade based on mutual interests. According to the USTR, India has committed to purchase more US goods and services, and purchase over $500 billion worth of US products. The framework includes additional market access commitments and support for more resilient supply chains, with both countries working toward a comprehensive bilateral trade agreement that will provide further benefits to US-linked Indian companies across various sectors. The much awaited India-US tariff deal removes the key overhang on the Indian economy, markets and currency, as noted by Nitin Jain, CEO of Kotak Mahindra Asset Management Singapore. This puts India in the pole position in the race to China +1 opportunity in global supply chains, with the deal strengthening India's position in the global economy and enhancing its reputation as a reliable trade partner.
