All key sensitive sectors protected under India-U.S. Interim trade pact: Commerce Secretary

Commerce Minister Rajesh Agrawal said India has always negotiated trade deals with an “open mindset” on sectors that are “very” sensitive for the country and has protected all these key segments under the interim trade agreement with the US.

He also said that both teams are working to turn the joint statement into a legal agreement, which is expected to be finalized and signed before the end of March.

“India has always negotiated all the agreements with a clear mindset; everything that is very sensitive for India; everything that we feel our farmers, our fishermen, our dairies will be affected; we have been very clear to our partner countries that India will not be able to open the door or provide access,” he told reporters in Nuremberg.

“If you look at all the agreements we made last year, the five trade agreements we made – all the sensitive sectors were protected. In the US, all the major sensitive sectors were protected. Wherever there was some sensitivity, we used tariff rate quota mechanisms to ensure that any market access was inherently limited and did not impact our farmers,” he added.

Under the interim trade agreement announced earlier this month, India has fully protected sensitive agriculture and dairy products such as corn, wheat, rice, soy, poultry, milk, cheese, ethanol (fuel), tobacco, some vegetables and meat; because within the scope of the agreement, the USA was not given any customs duty privileges on these goods.

These products are sensitive because they concern the livelihoods of small and marginal farmers in the country.

In other Free Trade Agreements (FTAs), India has not extended any import duty concessions to precision agriculture and dairy products. It has recently concluded free trade agreements with the European Union, the United Kingdom and Australia.

Agriculture and allied activities such as animal husbandry form the backbone of India’s rural economy, providing employment to more than 500 million people. Unlike developed economies where agriculture is highly mechanized and corporatized, in India it is a matter of livelihood.

India’s agricultural sector is currently protected by moderate to high tariffs or import duties and regulations to protect domestic farmers from unfair competition.

US agricultural exports to India were $1.6 billion in 2024. Major exports include Almonds (in shell, $868 million); Pistachios ($121 million), Apple ($21 million), Ethanol (ethyl alcohol, $266 million).

The Secretary was in Nuremberg for the Biofach 2026 exhibition, where over 100 Indian exhibitors from around 20 States showcased their organic products. The European Union (EU) is a large market for these products.

“Teams are working on it and we hope to achieve it by March.” [interim trade pact with the U.S.] official,” Mr. Agrawal said.

Talking about labour-intensive sectors, he said the agreement with the US will give them an advantage in the American market compared to rival countries that face higher tariffs than India.

Mutual duties with India will be reduced to 18 percent, China to 35 percent, and Vietnam to 20 percent.

“Since the USA is a strong market for the labor-intensive sector, our labor-intensive sectors will benefit from this temporary agreement. They will be able to grow without obstacles.”

“So my feeling is that Indian exporters will be able to compete with their rivals, revitalize and rejuvenate the supply chains that they may have missed during the Christmas period, and see Indian exports not only grow but remain as good as last year and grow in the coming years as well,” the Minister said.

Labor-intensive sectors such as textiles, ready-made clothing, maritime, precious stones and jewelery were affected by the high 50% taxes imposed by the USA. The Trump administration eliminated 25 percent punitive tariffs and will reduce reciprocal tariffs from 25 percent to 18 percent.

Mr Agrawal also said stakeholders and exporters were happy with the outcome and “liked” the overall agreement.

“What we were able to achieve in the interim agreement is good for India and our exports. I don’t see a major red line in this,” he said.

It was published – 11 February 2026 11:43 IST