The White House published a factsheet which details the main components of the India–United States trade agreement to resolve confusion generated by Donald Trump who said India would reduce tariffs on American products to zero.

The Trump administration described the agreement as a “historic step” because it would enable Americans to sell their products into India’s market which serves more than 1.4 billion people. The factsheet shows that the United States will decrease its reciprocal tariff applied to Indian goods from 25% to 18% while United States will eliminate the extra 25% tariff which applied to Indian products because India chose to stop buying Russian oil.

What the Deal Says on Tariffs

The White House statement sought to temper Trump’s earlier remarks, clarifying that India has agreed to “eliminate or reduce tariffs”—not abolish them entirely—on all US industrial goods and a broad range of American agricultural and food products.

The product selection covers dried distillers’ grains (DDGs), red sorghum, tree nuts, fresh and processed fruits, select pulses, and soybean oil, wine, spirits, and other items. Officials stated that the main focus will be on implementing gradual reductions and providing specific entry points into markets instead of establishing an immediate program for absolute duty elimination that would apply to all products.

The factsheet shows that India made a commitment to buy more American products which includes more than $500 billion worth of US energy, information and communication technology products, agricultural commodities, coal and other items.

Addressing Non-Tariff Barriers

New Delhi has made a commitment to address non-tariff obstacles that affect bilateral trade between the two nations in key economic sectors. India has decided to eliminate its digital services taxes while entering talks to establish complete digital trade regulations between the two nations.

The proposed rules will limit unfair practices which discriminate between companies and impose excessive requirements on businesses while protecting electronic transmissions from all customs duties.

The two countries have decided to establish rules of origin which will ensure that India and the United States receive most of the agreement’s benefits.

Technology, Supply Chains and Economic Security

The White House announced that Washington and New Delhi will increase their technology trade and strengthen their technological partnerships through their upcoming agreement. The two parties agreed to enhance their economic security systems which will include building supply chains and developing new technologies to counter the market-related strategies of third countries.

The cooperation will focus on three areas which include investment review processes and export control systems and methods for addressing unfair trade practices.

Putting Trump’s Claim in Context

Trump had earlier asserted that India agreed to reduce “tariffs and non-tariff barriers against the United States to ZERO.” The language indicated that the United States had granted a complete concession but the factsheet showed that the commitment contained two main principles which would apply to particular tariff reductions.

The claim had triggered anxiety among Indian traders, prompting the White House to spell out the actual scope and intent of the agreement.

What Comes Next

The factsheet followed a recent call between Trump and Prime Minister Narendra Modi, during which both leaders agreed on a framework for an interim reciprocal trade agreement and reaffirmed their commitment to negotiations on a broader US–India Bilateral Trade Agreement (BTA).

The two parties will proceed to implement the framework in the upcoming weeks as they work toward completing the interim agreement which they aim to achieve through a mutually advantageous BTA.

The White House stated that future negotiations will address all remaining tariff and non-tariff obstacles along with technical and customs issues and all aspects of services and investment and intellectual property and labor and environmental standards and government procurement and state-owned enterprises.