India–US Interim Trade Deal: Euphoria Cracks as Fine Print Bites

Analysts concur that the US is a winner in trade deal with India and Modi faces tough questions

By MANISH ANAND

New Delhi, February 7, 2026 — The joint statement on India-US interim trade deal on Saturday revealed at a time which suited the Americans. The US stock markets vaulted even while direct links with India deal may not be quickly available. New Delhi now faces questions, while few answers are forthcoming.

The Opposition Congress has unleashed a barrage of AI generated videos, featuring Prime Minister Narendra Modi. The running theme is: “Modi surrendered.”

A section of famers’ unions, Samyuka Kisan Morcha (SKM) has sought resignation of Union Minister for Commerce Piyush Goyal. The big red flag in agriculture deal is: India will allow imports of Distiller’s Dried Grains with Solubles (DDGS). This is allegedly genetically modified (GM) crop. Goyal reportedly told reporters that “processing erases GM traces.”

The bravado of strategic autonomy has also come under clouds. Assertion of strategic autonomy had hogged the stage of Shanghai Cooperation Organisation (SCO) in Tianjin in China in September last year. Modi had clutched hands of Russian and Chinese President Vladimir Putin and Xi Jinping respectively to send a loud message to Washington. That India will not yield on strategic autonomy.

Union Minister for External Affairs Subrahmanyam Jaishankar ducked the question: will India stop buying Russian oils? He counselled reporters to ask Goyal. The Commerce Minister passed the buck, telling reporters to “ask the MEA.”

After several hours, the MEA gave a statement: “Diversifying our energy sourcing in keeping with objective market conditions and evolving international dynamics is at the core of our strategy. All of India’s actions are taken and will be taken with this in mind.” The statement doesn’t give a direct answer, leaving scope for interpretation.

US President Donald Trump in a show of agility signed an executive order to remove the punitive 25 percent tariffs on India for buying Russian oils. India per deal has committed to buy American energy products substantially.

Will Russia be angered? Russian President Vladimir Putin had come to New Delhi on a red-carpet welcome recently. India-Russia defence partnerships buzzed western capitals during his New Delhi stay. Will India-Russia strategic ties face Trump-Modi bonhomie test? Analysts have mixed opinions.

Russia is a fossil fuel economy. America is world’s largest consumption market. India’s current share of American imports annually is a meagre three percent. An expansion of the share as India with 18 percent tariffs is placed favourably than most of the east Asian economies, as well as neighbours Bangladesh and Pakistan. Besides, Washington’s return to bashing Beijing suits New Delhi.

Will it be a short-term pain with hopes for long-term gains? Too early to answer, for India lacks scale of productions and skilled manpower to match China. This pushes the scale in favour of the US in the trade deal with India. And, that may put Modi in a spot in near future.

India, US Announce Interim Trade Agreement Framework

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About The Author

Manish Anand

Manish Anand is a senior journalist with more than two decades of hardcore reporting on beats such as Prime Minister’s Office, Parliament, BJP, Congress, Planning Commission, NITI Aayog, and scores of Union Ministries.

His past has been with The New Indian Express, The Asian Age/Deccan Chronicle, and The Statesman.

For about 15 years, Manish was also a regular commentator and host for talks on AIR on foreign affairs.

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