Following the high-profile announcement by Prime Minister Narendra Modi and US President Donald Trump, the finer details of the historic India-US interim trade deal have finally emerged. A joint statement released on Saturday, February 7, 2026, has answered the “key question”: In exchange for a massive reduction in US tariffs, what exactly will India buy?
Under the new “Mission 500” framework, India has committed to purchasing $500 billion worth of American goods and services over the next five years.
The Import Basket: What India is Buying
To balance the trade deficit and secure lower tariffs for Indian exporters, New Delhi will focus its $500 billion spend on high-value sectors:
- Energy & Resources: Significant procurement of American energy products and coking coal to fuel India’s industrial expansion.
- Aviation: Purchase of aircraft and aircraft parts, further supporting the growth of India’s civil aviation sector.
- High-Tech & AI: Imports of Graphics Processing Units (GPUs) and advanced hardware essential for AI applications and national data centers.
- Precious Metals: Specialized imports of precious metals to support India’s manufacturing and jewelry sectors.
Commerce Minister Piyush Goyal clarified that India will primarily import goods that are not produced sufficiently within the country, ensuring the deal remains a “win-win” for domestic industries.
The Competitive Edge: India vs. Asia
The deal repositioned India as the most competitive exporter in the region. By slashing US tariffs on Indian goods from 50% to 18%, India now holds a significant advantage over its trade rivals:
| Country | US Import Tariff Rate |
| India | 18% |
| Pakistan | 19% |
| Indonesia | 19% |
| Vietnam | 20% |
| Bangladesh | 20% |
| China | 33% |
Major Wins for Indian Exports
While India imports tech and energy, it has secured zero-duty access (starting March 2026) for several critical sectors:
- Agriculture: Spices, tea, coffee, mangoes, pineapples, and cashews will face no US duties.
- Pharmaceuticals: Negotiated outcomes for generic drugs, providing a massive boost to India’s “Pharmacy of the World” status.
- Labor-Intensive Sectors: Restored competitiveness for textiles, apparel, leather, and footwear.
- Gems & Jewelry: Immediate relief for the diamond and jewelry industry.
Minister Goyal emphasized that the deal “fully protected” Indian farmers through specific exceptions, ensuring sensitive sectors like dairy remain shielded from unrestricted imports.