India has taken a decisive step to enhance its position in the global economy with the announcement of a bilateral trade deal with the United States. Announced on 2nd February 2026 via the Truth social platform by U.S. President Donald Trump, the agreement reduces reciprocal tariffs on Indian goods from 25% to 18%, providing immediate relief to exporters while opening new avenues for trade and investment.

Deloitte hails strategic timing and growth potential

Anil Talreja, Partner at Deloitte India, described the move as part of India’s broader effort to consolidate its place in the world economic order. “Two deals in two weeks with nations of more than $50 trillion economic size—the common factor here is India,” Talreja noted. He emphasized that the timing aligns with domestic measures announced in the Budget aimed at boosting manufacturing, productivity, and income levels.

“Opening India’s large consumer markets for U.S. and European companies will turbocharge the country’s growth story, increasing standards of living and reinforcing India’s niche in the global order,” he added.

Trade deal to complement manufacturing push

Deloitte partner Gulzar Didwania highlighted that while the reduction in reciprocal tariffs is significant, certain U.S. tariffs under Section 232, particularly on steel, aluminium, copper, and automobiles, are expected to remain. “The framework for this agreement, including timelines and enforcement, is yet to be formalized. However, it lays the foundation for India to leverage these trade opportunities,” Didwania said.

Grant Thornton sees export recovery and MSME benefits

Krishan Arora, Partner at Grant Thornton Bharat, welcomed the deal as a first tranche of US-India bilateral trade. “Tariff reduction from 25% to 18% is a welcome move and provides immediate relief for Indian exporters who were grappling with shrunken margins,” Arora said. He added that India’s successive deals with the UK, EU, and now the US highlight the nation’s growing global trade potential. “However, the coverage across all product verticals still needs to be assessed, especially under the Trade Expansion Act of 1962,” he noted.

Manoj Mishra, Partner and Tax Controversy Management Leader at Grant Thornton Bharat, emphasized the impact on MSME-led sectors such as textiles, apparel, gems and jewellery, and leather. “This deal reinforces India’s position as a reliable long-term sourcing partner for the US, supporting order recovery and restoring buyer confidence. Alongside market-diversification efforts, including the India-EU FTA, it could meaningfully boost export competitiveness and support broader economic growth. However, a predictable, transparent, and well-notified tariff framework will be critical to sustaining export momentum,” Mishra said.

Boost for manufacturing and exports

According to Deloitte and Grant Thornton, the India-US agreement, alongside domestic manufacturing incentives, could accelerate growth across sectors, particularly those contributing to export-led industrial expansion. Analysts expect that the combination of external market access and internal policy support will enhance productivity, increase per capita income, and provide broader benefits for India’s large consumer base.