Basic HTML Version

|  | Table of Contents |  | View Full Version

Page 4 - The Indian EYE 022026
P. 4

    COVER STORY                                                        FEBRUARY 20, 2026       |  The Indian Eye                    4

                                                       INDIA–US TRADE

                            MODI GOVT

             DEFENDS DEAL

               As the interim India–US trade agreement moves towards fine print, a fierce political battle
                     has erupted over tariffs, cotton imports and the future of India’s textile backbone

            OUR BUREAU                                                                                            diamonds, and aircraft parts will be
                                                                                                                  removed.
            New Delhi/Washington
                                                                                                                      Goyal has described this as his-
                  he  India–US interim  trade                                                                     toric. “India has received the lowest
                  agreement, unveiled after a                                                                     tariff rates from the US compared to
            TFebruary 2 phone call between                                                                        other developing economy competi-
            Prime Minister Narendra Modi and                                                                      tors. I believe this is a game changer
            US President Donald Trump, was                                                                        for India’s future progress and devel-
            meant to signal momentum towards                                                                      opment,” he said.
            a broader Bilateral Trade Agreement
            (BTA). Instead, it has triggered an in-                                                               The textile sector is central to
            tense political confrontation, with the
            government projecting it as a “game                                                                   the government’s optimism.
            changer” and the Opposition brand-                                                                    Through the 9 FTAs, markets
            ing  it  a  “trap  deal” that could hurt
            cotton farmers and textile exporters.                                                                 worth nearly Rs 45 lakh crore
                At the heart of the clash lies a                                                                  are opening up for Indian
            deceptively simple question: does
            the new tariff regime open unprece-                                                                   goods. The US alone buys Rs
            dented opportunity for India, or does                                                                 9 lakh crore worth of textiles,
            it  corner  the  country  into  difficult
            trade-offs?                                                                                           while the European Union buys
                 A Calibrated Opening                                                                             over Rs 22 lakh crore. Accord-

                   nion Commerce Minister Pi-                                                                     ing to SBI Research, the US
                   yush Goyal has framed the                                                                      currently imports around USD
            Udeal as part of a larger strat-
            egy. Speaking at a press conference                                                                   7.5 billion of textiles from In-
            on the #ViksitBharatBudget, he                                                                        dia and a similar amount from
            underlined that  “nearly 70  per cent
            of global trade markets are open to                                                                   Bangladesh.
            India, where preferential access has
            been ensured through Free Trade                                                                           “There are tremendous oppor-
            Agreements (FTAs).” India, he said,                                                                   tunities opening up for India’s textile
            has concluded “9 FTAs with 38 devel-                                                                  sector. I am confident that Indian en-
            oped countries,” providing “special                                                                   trepreneurs will take full advantage
            advantages compared to other coun-                                                                    of this opportunity, capture large
            tries.”                           Union Minister of Commerce & Industry Piyush Goyal, with US Ambassador to India Sergio Gor at   markets, increase exports, and gen-
                “These 9 FTAs protect all sensi-                                                                  erate employment,” Goyal said.
            tive sectors while allowing calibrated   the reception hosted at US Ambassador Sergio Gor’s residence, in New Delhi (ANI Video Grab)  A key provision has drawn par-
            openings in areas where imports are                                                                   ticular attention: the “yarn forward”
            needed. They create policy stability,   line number is significant. Since Au-  cent on selected Indian goods includ-  principle. As Goyal explained to ET
            clarity, and predictability, which at-  gust 2025, Indian goods entering the   ing textiles, apparel, leather, foot-  NOW, “It’s called a yarn forward —
            tract large-scale investments,” Goyal   US had faced a 50 per cent tariff.   wear and certain machinery. Upon   if you buy cotton or yarn from the US
            asserted.                         Following the leaders’ phone call,   full implementation, US tariffs on   and process it and produce garment,
                On the US specifically, the head-  that tariff has been reduced to 18 per   generic pharmaceuticals, gems and   Continued on next page... >>

                                                                   www.TheIndianEYE.com

| 1 2 3 4 5 6 7 8 9 |