New Delhi, February 8: The recent trade agreement between India and the United States has sparked optimism in the business sector. Industry experts believe that the interim trade deal framework will significantly bolster India’s ambitious goal of surpassing $120 billion in exports by the fiscal year 2025-26.
According to the Engineering Export Promotion Council of India (EEPC), the reduction in tariffs is expected to strengthen India’s target of achieving $250 billion in engineering exports by 2030. The council stated, “The U.S. is the largest market for engineering goods. EEPC welcomes the release of the framework for an interim agreement between the two countries, as it reduces duties and trade barriers.”
The proposed agreement is anticipated to promote local manufacturing and provide Indian exporters, particularly in the engineering sector, with greater market access in the world’s largest economy.
The agreement clearly outlines that the 25% tariff imposed by former President Donald Trump on India has been reduced to 18%. Additionally, tariffs related to oil purchases from Russia have been lifted. India will also benefit from a preferential tariff rate quota for automotive parts.
This will aid the engineering export sector in regaining its competitiveness in the U.S. market. EEPC expressed optimism that MSME engineering exporters will gain significantly from the trade deal with the U.S. The council hopes that duties imposed under Section 232 on steel, aluminum, and automotive components will also be reduced in the future.
It was noted, “A deeper trade partnership with the U.S. is beneficial for both sides. Once the interim deal is signed and a larger agreement is reached, export growth in the Indian engineering sector could see substantial increases. This will play a crucial role in achieving the $250 billion engineering export target by 2030.”
Moreover, the joint statement from the U.S. and India has boosted confidence in the Indian engineering sector. This trade agreement is expected to help engineering exporters regain several old buyers while also attracting new customers, leading to robust export growth in the coming months.
Leave a Comment