-Ramphal Kataria
From Strategic Autonomy to Managed Compliance: Reading the Indo–US Trade Framework
Abstract
The interim trade framework announced between India and the United States in 2025 marks a decisive departure from India’s long-standing trade diplomacy, agricultural protectionism, and claims of strategic autonomy. Unlike earlier trade negotiations—characterised by parliamentary debate, stakeholder consultations, and reciprocal tariff bargaining—this framework has emerged almost entirely through unilateral disclosures by the United States. Official statements from the White House, the US Trade Secretary, and former President Donald Trump’s social media account on Truth Social reveal commitments that stand in direct contradiction to assurances given by India’s Commerce Minister to Parliament and the public. This commentary argues that the framework is neither interim nor reciprocal, but an imposed arrangement shaped by coercive tariffs, geopolitical conditionalities, and surveillance of India’s foreign policy choices, particularly with regard to Russian oil imports. The opening of India’s agricultural sector to genetically modified (GM) soya oil, distillers dried grains (DDGs), maize by-products, sorghum, fruits, nuts, and pulses—confirmed in US fact sheets—signals a structural shift with profound implications for farmers, food sovereignty, and federalism. The paper situates the deal within a broader political economy of unequal exchange, executive secrecy, and declining credibility of India’s foreign and trade policy institutions.
Introduction
The interim trade framework announced between India and the United States in February 2026 has rapidly become one of the most contested economic agreements in recent Indian history. The controversy does not stem merely from opposition politics or farmer mobilization, but from the striking mismatch between what has been officially communicated by the Government of India and what has been revealed—often unilaterally—by the United States government. White House factsheets, Executive Orders, press briefings, and statements by President Donald Trump on his social media platform Truth Social have together painted a picture far more expansive and intrusive than the carefully worded joint statement issued on 6 February 2026.
This commentary argues that the agreement represents a qualitative shift in India–US economic relations: from negotiated reciprocity to imposed conditionality; from calibrated liberalization to sectorally asymmetric opening; and from strategic autonomy to externally monitored compliance. The opacity surrounding the deal has compounded its substantive asymmetry, undermining democratic accountability and eroding the credibility of ministerial assurances.
India–US Trade Relations Before Trump: Negotiated Asymmetry
India–US trade relations prior to the Trump administration were marked by persistent disagreements, particularly over tariffs, agriculture, intellectual property, and digital taxation. India maintained some of the highest applied tariffs among major economies—averaging 30–37% for agricultural goods and exceeding 100% for certain automobiles and dairy products. These tariffs were not accidental; they reflected deliberate policy choices rooted in food security, smallholder protection, and developmental space.
The United States repeatedly challenged these barriers, but disputes were addressed through multilateral forums, retaliatory tariffs, or prolonged negotiations. Crucially, India resisted opening politically sensitive sectors such as dairy, genetically modified food products, and mass-consumption staples like pulses and edible oils. Trade frictions existed, but they were embedded in a rules-based, negotiated framework.
This equilibrium began to unravel with Trump’s return to office and the unilateral imposition of punitive tariffs—reportedly up to 50%—on Indian exports. These tariffs were framed by Washington as “reciprocal”, but functioned in effect as economic coercion designed to force market access concessions.
The Interim Framework: Reciprocity Redefined
According to the White House factsheet dated 9 February 2026, India has agreed to eliminate or reduce tariffs on all US industrial goods and a wide range of food and agricultural products. These include dried distillers’ grains (DDGs), red sorghum, tree nuts, fresh and processed fruits, soybean oil, wine and spirits, and notably, “certain pulses”.
This language is materially broader than that contained in the joint India–US statement, which omitted pulses entirely and restricted red sorghum imports to animal feed. The disappearance of this qualifier in the US document is not a semantic detail; it has direct implications for domestic food markets and regulatory oversight.
In return, the United States has reduced its unilateral reciprocal tariff on Indian goods from 50% to 18%. This tariff continues to apply to roughly 55% of Indian exports. In other words, India has agreed to permanent tariff liberalization, while the US has merely partially rolled back a penalty it imposed unilaterally.
White House Fact Sheet on the India–US Interim Trade Framework
The following excerpts reproduce the language of the original White House fact sheet released in February 2026, as reported by multiple Indian newspapers before subsequent quiet revisions were made. These excerpts are crucial because they constitute the only authoritative public disclosure of India’s sectoral commitments under the interim framework.
“India will eliminate or reduce tariffs on all U.S. industrial goods and a wide range of U.S. food and agricultural products, including dried distillers’ grains (DDGs), red sorghum, tree nuts, fresh and processed fruit, certain pulses, soybean oil, wine and spirits, and additional products.”
“India committed to buy more American products and purchase over $500 billion worth of U.S. energy, information and communication technology, agricultural, coal and other products.”
The above wording was later altered by the White House—references to “certain pulses” were removed and the phrase “committed to buy” was softened to “intends to buy.” Notably, no corresponding clarification or disclosure was issued by the Government of India, even though these products fall squarely within politically sensitive and constitutionally shared domains such as agriculture and food policy.
The contradiction between this fact sheet and repeated public assurances by India’s Commerce Minister that “agriculture has not been opened” represents not a difference of interpretation, but a difference of record. In the absence of any Indian-authored text, the White House document effectively functions as the de facto trade agreement.
Agriculture as the Fault Line
Agriculture has emerged as the most politically and economically sensitive axis of the deal. Despite repeated assurances by the Commerce Minister that farmers’ interests—particularly in dairy and food staples—have been safeguarded, the White House factsheet tells a different story.
The inclusion of GM soybean oil and DDGs is especially contentious. DDGs, a by-product of maize-based ethanol production, have been associated with contamination risks and uncertain health impacts. GM soybean oil remains a politically contested commodity in India, where regulatory caution has traditionally prevailed.
The reference to “certain pulses” is perhaps the most alarming. Pulses are central to India’s nutrition security and farm economy. Even limited tariff reductions can depress domestic prices, as evidenced by India’s experience with edible oil liberalization over the past two decades. Farmer unions have warned that such concessions could undercut incomes and exacerbate agrarian distress.
Foreign Policy Conditionality and the Russian Oil Clause
The most unprecedented aspect of the framework lies outside traditional trade policy. The White House factsheet and subsequent Executive Order explicitly state that the rollback of the additional 25% tariff was granted in recognition of India’s commitment to stop purchasing Russian oil.
More significantly, the Executive Order mandates monitoring by a committee of US secretaries to assess whether India resumes Russian oil imports “directly or indirectly”, with the threat of reimposing tariffs. This represents an extraordinary intrusion into India’s sovereign energy policy and foreign relations. No previous trade agreement has subjected India’s external policy choices to external surveillance.
While Indian officials have insisted that energy procurement decisions remain guided by national interest, the absence of any explicit denial in the joint statement—and the detailed articulation of conditionality in US executive instruments—raises serious concerns about the erosion of strategic autonomy.
Why the Deal, and Why the Silence?
Three explanations help illuminate India’s acceptance of this framework. First, the immediate pressure created by punitive US tariffs threatened export-oriented sectors such as textiles, gems, leather and handicrafts. Second, the agreement reflects a broader geopolitical alignment in which economic concessions serve as signals of strategic compliance. Third, decision-making appears to have been highly centralized, with limited ministerial ownership or parliamentary scrutiny.
The opacity surrounding the deal is particularly troubling. The framework has not been tabled in Parliament. Detailed commitments have not been officially released. Instead, Indian stakeholders have been forced to rely on US disclosures to understand the scope of India’s obligations.
Comparative Perspective: Tariffs and Commitments
Sector / Item | Pre-Trump Indian Tariff on US Goods | Interim Framework Commitment | US Tariff on Indian Goods (Post-Deal) |
Industrial Goods | 7–15% average | Eliminated or sharply reduced | 18% on ~55% exports |
Agriculture (Average) | 30–37% | Reduced/eliminated on listed items | 18% |
Pulses | 30–50% (variable) | Included (“certain pulses”) | 18% |
GM Soybean Oil | High / restricted | Tariff reduction permitted | 18% |
DDGs | Restricted / high | Tariff reduction permitted | 18% |
Red Sorghum | Restricted; animal feed | No end-use qualifier | 18% |
Executive Order of the President of the United States – Trade Conditionality and Monitoring of Indian Oil Imports
The following passages are reproduced verbatim from the Executive Order signed by President Donald Trump in February 2026, modifying tariff duties applicable to India. This document formally links tariff relief to ongoing surveillance of India’s foreign policy choices, particularly with respect to Russian oil imports.
“Sec. 2. Tariff Modifications.
Effective with respect to goods entered for consumption, or withdrawn from the warehouse for consumption, on or after 12:01 a.m. eastern standard time on February 7, 2026, products of India imported into the United States shall no longer be subject to the additional ad valorem rate of duty of 25 percent imposed pursuant to Executive Order 14329.”
“Monitoring and Recommendations.”
“The Secretary of Commerce, in coordination with the Secretary of State, the Secretary of the Treasury, and any other senior official the Secretary of Commerce deems appropriate, shall monitor whether India resumes directly or indirectly importing Russian Federation oil… If the Secretary of Commerce finds that India has resumed directly or indirectly importing Russian Federation oil… the Secretary of State shall recommend whether and to what extent I should take additional action as to India, including whether I should reimpose the additional ad valorem rate of duty of 25 percent on imports of articles of India.”
This language is unprecedented in India–US trade relations. For the first time, tariff relief granted to India is explicitly conditional on compliance with US preferences in matters of foreign and energy policy. The constitution of a multi-secretary monitoring mechanism to oversee India’s oil sourcing decisions amounts to a formalization of external supervision over sovereign economic choices.
No Indian official statement, cabinet note, or parliamentary disclosure has acknowledged this provision. The absence of denial is as significant as the absence of explanation. Taken together with India’s withdrawal from Chabahar-related engagements under US pressure and its compliance with sanctions regimes against Iran and Russia, the executive order confirms that the interim trade framework is not merely commercial in nature, but disciplinary in design.
Credibility, Democracy and Strategic Autonomy
Claims that India’s 18% tariff is among the lowest faced by US trading partners obscure the broader context. China continues to import discounted Russian oil without external monitoring, enhancing its industrial competitiveness. India, by contrast, faces higher energy costs and external scrutiny.
The cumulative effect is an erosion of credibility—of ministerial statements, of parliamentary accountability, and of India’s claim to independent foreign policy. Agreements may be unequal; diplomacy often is. But secrecy compounds inequality with indignity.
Conclusion
The interim Indo–US trade framework represents not merely a commercial arrangement, but a structural reordering of India’s economic and strategic posture. Its asymmetries may or may not be defensible. Its opacity is not. What has been agreed must be placed before Parliament and the public in full. Transparency is not a concession—it is the minimum requirement of democratic governance.
References
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