NEW DELHI: India has agreed to buy petroleum, defence goods and aircraft from the U.S., while partly opening up its highly-guarded agriculture sector under a trade deal, a government official told Reuters.
A trade deal was announced by President Donald Trump with India on Monday that slashes U.S. tariffs on Indian goods to 18% from 50% in exchange for India halting Russian oil purchases and lowering trade barriers.
As cited by Reuters, Trump said India agreed to buy more American goods with purchases rising to as much as $500 billion including energy, coal, technology, agricultural and other products.
The Indian government official, who did not want to be named, said India has agreed to buy U.S. goods including telecom and pharmaceuticals and offered market access for some agricultural products, as part of New Delhi’s commitments under the deal.
India recently offered select market access for agricultural products to the European Union under a trade deal.
The official added tha the Asian nation has also lowered tariffs on imported cars to address Washington’s immediate U.S. demands to conclude the first tranche of the deal.
India’s trade ministry did not immediately reply to an e-mail seeking comment.
According to the Indian government data, India’s exports to the U.S. rose 15.88% year-on-year to $85.5 billion in January-November, while imports stood at $46.08 billion.
“The commitment to buy U.S. products covers sectors like pharmaceuticals, telecom, defence, petroleum and aircraft. It will be done over the years,” the official told Reuters.
The official said a more comprehensive pact with the U.S. will be negotiated over coming months.
“Lower tariffs will not only improve price competitiveness but also help Indian exporters integrate more deeply into U.S. supply chains,” said S.C. Ralhan, president of the Federation of Indian Export Organisations.
Reduction in U.S. tariffs on most Indian goods will reinvigorate India’s goods exports to the U.S., Moody’s Ratings said in a statement on Tuesday.
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