The nation has agreed to buy petroleum, defence goods, and aircraft from the United States, while partly opening up its highly-guarded agriculture sector under a trade deal, according to a government official, as the two sides reconcile after months of tensions.
President Donald Trump announced a trade deal with India on Monday that slashes US tariffs on Indian goods to 18% from 50% in exchange for India halting Russian oil purchases and lowering trade barriers.
Trump said India agreed to buy more American goods with purchases rising to as much as US$500bil (RM1.9 trillion) 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 US 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 Asian nation has also lowered tariffs on imported cars to address Washington’s immediate US demands to conclude the first tranche of the deal, the official added.
India’s exports to the US rose 15.88% year-on-year to US$85.5bil (RM336.7bil) from January to November, while imports stood at US$46.08bil (RM181.5bil), Indian government data showed.
“The commitment to buy US products covers sectors like pharmaceuticals, telecom, defence, petroleum and aircraft. It will be done over the years,” the official said.
The official added that a more comprehensive pact with the United States will be negotiated over coming months.
The 18% tariff offered to India is lower than its Asian peers and comes right in time as exporters are still negotiating annual contracts with their US customers, the official said.
Among Asian nations, US tariffs on goods from Indonesia stand at 19% while the rate for Vietnam and Bangladesh stands at 20%. — Reuters
