Tariff relief, not real gains:What India gave up and what the US didn’t – a closer look at the interim trade deal

India’s interim trade deal with the United States may look like a breakthrough, but a closer examination suggests that New Delhi may have accepted a lopsided bargain. According to the Global Trade Research Initiative (GTRI), the US has not reduced its MFN tariffs at all—instead, it has merely rolled back its own punitive reciprocal tariffs, cutting them from 50% to 18% on roughly 55% of Indian exports. “The US has only undone the punitive measures it should never have imposed in the first place, while India has offered permanent market access,” noted Ajay Srivastava, a former trade officer and founder of GTRI. Who pays the price at home? In contrast, India has agreed to lower or eliminate MFN tariffs on virtually all US industrial goods and a broad range of agricultural imports—from fruits and soybean oil to wine and spirits—areas that directly intersect with sensitive domestic sectors and could place Indian farmers at a disadvantage. The agreement also opens the door to tariff concessions on electronics components, smartphones, and clean-energy inputs—moves that, GTRI argues, risk undermining India’s manufacturing ecosystem at a critical stage of industrial expansion. What New Delhi receives, then, is temporary relief from the United States’ unsustainable and arguably unlawful retaliatory tariffs. What Washington secures is lasting access to the Indian market. How much autonomy is lost? More troubling, the framework embeds multiple non-tariff and strategic concessions. India has signaled closer alignment with US economic-security priorities, potentially limiting its ability to engage freely with third countries and constraining autonomy on sanctions and geopolitical choices—an adjustment that could strain ties with BRICS partners. Commitments on standards and non-tariff barriers could also tilt India’s regulatory architecture—especially in agriculture, health, and digital governance—toward US preferences, echoing the one-way concessions Washington has extracted from smaller economies such as Malaysia. The US is pushing India toward commitments on digital trade that could ban digital services taxes, accept a permanent moratorium on customs duties on electronic transmissions, and limit future regulation of Big Tech. GTRI warns this would undermine India’s long-standing WTO position and reduce its ability to tax and regulate its digital economy. Big promises, little clarity Finally, India’s pledge to purchase $500 billion worth of American goods over five years—more than double its current import levels—appears unrealistic, particularly because big-ticket orders such as aircraft are determined by the private sector, not the government. As Srivastava observes, the framework “opens the doors for further commitments on agriculture, regulatory and other issues,” suggesting that this is only the first step in a broader set of US expectations.