WASHINGTON, United States (UN): US President Donald Trump scrapped a punitive tariff on India that he had introduced to indirectly weaken Russia’s oil trade, as India agreed to buy US goods worth USD500 billion (RM1.98 trillion), the German Press Agency (dpa) reported.
The US and India published the framework for a preliminary trade agreement that provides for a reduction in additional US import duties on Indian goods from 25 per cent to 18 per cent.
The 25 per cent rate, introduced in August, was no longer being applied as of Saturday (Feb 7).
In a joint statement, both sides said this would benefit both sides.
India will eliminate or reduce “tariffs on all US industrial goods and a wide range of US food and agricultural products”.
Also, India plans to buy US goods worth USD500 billion over the next five years, including energy products, aircraft and aircraft parts.
Indian Trade Minister, Piyush Goyal, defended the agreement against criticism from the opposition that the US would benefit more from the agreement in comments on Saturday.
The interim agreement will open up a USD30 trillion (RM118.2 trillion) market for Indian exporters and provide the opportunity for hundreds of thousands of new jobs, he said in a post on X.
Alongside reducing US tariffs to 18 per cent, tariffs on goods such as generic drugs, gemstones and aircraft parts are to be set at zero.
Trump had signed an executive order on Friday (Feb 6) that the 25 per cent tariff penalty on goods imported from India to the US would no longer be levied.
The US had introduced punitive tariffs against Russia’s trading partners to reduce oil revenues used by Russian President, Vladimir Putin, to finance Moscow’s full-scale invasion of Ukraine, launched in 2022. – BERNAMA-dpa
