US Tariff Reset to Give Zero-Duty Access to 50% of Indian Exports: Piyush Goyal

India is set to gain significantly from a major reset in US tariff policy, with nearly half of Indian exports to the United States expected to face zero import duty under a new framework announced by the Donald Trump administration.

Commerce and Industry Minister Piyush Goyal, speaking in an exclusive interview with a news agency, said the changes would come into force within days and deliver immediate benefits to exporters, particularly MSMEs and labour-intensive sectors.

The move follows an executive order issued by US President Donald Trump to reduce tariffs on Indian goods, even as the two countries continue to finalise the legal text of an interim India-US trade agreement.

US Executive Order to Take Effect Before Formal Trade Deal

Tariff Changes Expected Within Days

Goyal said the US executive order is expected to be implemented within four to five days, even before the formal signing of the bilateral trade agreement.

He explained that the tariff reset would substantially improve market access for Indian products and enhance the competitiveness of domestic exporters in the US market.

50% of Indian Exports to the US to Attract Zero Duty

Revised Tariff Structure Explained

According to Commerce and Industry Minister Piyush Goyal, around 50% of India’s exports to the US will attract zero duty under the new tariff regime.

From the remaining half:

• 10–15% of exports, including steel and aluminium, will continue to face US Section 232 sectoral tariffs of up to 50%

• Around 35% of exports will be subject to tariffs of approximately 18%

Clarifying the application of Section 232 duties, Goyal said:

"They'll have to look at how much is the steel or aluminum content, and accordingly, it will be a calibrated or a calculated import duty under Section 232 tariffs, not as a reciprocal tariff,"

He added that exporters would be able to avail of the revised 18% tariff regime from the date the US executive order comes into force, while India would continue discussions with Washington to reduce Section 232 tariffs as part of broader negotiations.

MSMEs and Labour-Intensive Sectors to See Immediate Gains

Textiles, Engineering and Handicrafts in Focus

Goyal said the agreement would provide a strong boost to MSME-driven and labour-intensive industries.

"I see a great fillip in the textile industry. I can clearly see the auto component and machinery parts industry, the engineering goods, the leather footwear and sports goods, toys, furniture, handicrafts, handlooms, a number of products, which directly relate to MSMEs or labor-intensive industries stand to gain from this agreement immediately,"

Industry experts say improved access to the US market could help Indian MSMEs expand exports, create jobs and strengthen global supply-chain integration.

Product Categories Getting Zero-Duty Access to the US

Agriculture, Gems, Consumer and Industrial Goods Included

Goyal said several product categories would receive zero-duty access under the new framework.

Agriculture & Food Products

Spices, tea, coffee and extracts, copra (coconut/coconut oil), vegetable wax, nuts (areca, Brazil nuts, cashew, chestnuts), fruits and vegetables (avocados, bananas, guavas, mangoes, kiwis, papaya, pineapple), shiitake mushrooms, bakery products, cocoa and cocoa preparations, processed foods, banana pulp, citrus juices, guava and mango paste

Gems & Jewellery

Gems and diamonds, coins

Consumer Goods

Clocks and watches, essential oils, select home décor items including chandeliers, illuminating signs and lamp parts

Metals & Industrial Products

Aluminium oxides, zinc oxides, iron hydroxides, inorganic chemicals and compounds of precious metals

Industrial & Other Products

Seeds, certain instruments and apparatus, minerals and natural resources, articles of paper, plastic and wood, natural rubber

Tariff Cuts on US Vehicles and Motorcycles

No Impact on Domestic Auto Industry

Sources told the news agency that the deal also includes tariff reductions on select US automobile imports.

• Tariffs on American motorcycles in the 800cc–1,600cc segment will be reduced to zero

• The category is currently dominated by Harley-Davidson, with no Indian manufacturer operating in this displacement range

Additionally:

• Tariffs on large diesel cars above 2,500cc and petrol cars above 3,000cc will be reduced to 50% initially

• These duties will be gradually lowered to 30% over a 10-year period

Officials said the move is not expected to affect Indian automakers, as domestic SUV manufacturers largely operate below these engine capacities.

Farmers’ Interests Fully Protected, Says Goyal

Sensitive Agricultural Products Kept Outside the Deal

Goyal dismissed criticism from what he described as “vested interests”, even as farmer groups announced protests on February 12.

He said India’s core red lines were fully protected and that sensitive agricultural and food items were completely excluded from the agreement.

Excluded products include dairy, poultry, meat, rice, wheat, sugar, soya, corn, millets, bananas, pulses and all genetically modified products. Fruits such as bananas, cherries, strawberries and citrus fruits, along with honey, ethanol for fuel and tobacco, have also been kept outside the deal.

Response to Concerns Over Soybean Oil and DDG Imports

Addressing objections from farmer groups including the Bharatiya Kisan Sangh, Goyal said India already imports soybean oil in large quantities and noted that genetically modified characteristics are eliminated once products are processed.

“I will be talking to the farmer groups and recommend them to carefully have a look at the exempt list. Farmers are completely protected in all core and sensitive areas,”

Export Growth Potential for Farm and Fisheries Sectors

Exports Could Double to $100 Billion

Goyal said the agreement would expand export opportunities for agriculture and fisheries.

“We will see our farmers and our fishermen get increased potential of exports. We are a substantial exporter of farm products and fish to many parts of the world, including the US, aggregating nearly $54-55 billion, that’s about ₹5 lakh crore. That number can easily double, particularly as we do more value addition in the years to come, to probably $100 billion,”

Apple Imports: Safeguards for Indian Growers

Minimum Import Price and Duty Floor Set

On apples, Goyal said India imports around 5.5 lakh tonnes annually due to demand exceeding domestic production.

The US has been offered an import quota lower than its current export volumes to India. American apples will be subject to:

• Minimum import price: ₹80 per kg

• Import duty: ₹20

This creates a floor price around 33% higher than apples imported from other sources, fully protecting Indian growers.

India-US Interim Trade Deal Targeted for Mid-March

Legal Text Under Finalisation

India and the US are targeting mid-March to sign the interim trade deal and are currently working on the legal text.

Goyal said India has invited US Trade Representative Jamieson Greer to New Delhi for the signing. The final document is expected to be a fully binding legal agreement incorporating the agreed zero-duty concessions.

Conclusion

The proposed tariff reset marks a major milestone in India-US trade relations, offering immediate gains for Indian exporters while safeguarding sensitive domestic sectors. With nearly half of Indian exports set to enjoy zero-duty access and MSME-driven industries poised for growth, the agreement could significantly strengthen India’s position in the US market.

At the same time, calibrated concessions on select US imports and firm protections for farmers underline India’s effort to balance openness with domestic priorities. As both sides move toward signing the interim deal by mid-March, the tariff cuts are expected to deliver a tangible boost to trade, jobs and export competitiveness.