The framework trade agreement concluded in February 2026 between India and the United States, which was formally intended to liberalise bilateral trade, has sparked an intense debate within India. Opposition parties, industry experts and farmers’ organisations view the terms of the deal as unprecedented concessions that could undermine New Delhi’s strategic autonomy.
Under the agreement, Washington will reduce tariffs on Indian exports from 50 per cent to 18 per cent, which could benefit export-oriented hubs such as the textile centres of Tiruppur and Surat. However, critics note that India’s effective tariff rate was around 3 percent before the tariff hike in 2025. The initial increase to 50 percent was widely considered to be politically motivated, and the current ‘reduction’ to 18 percent is seen as only a partial reversal rather than a genuine concession.
The most serious concerns relate to energy policy. In August 2025, the United States imposed 25 per cent tariffs on certain Indian goods, citing India’s purchases of Russian oil. The new agreement lifts these measures, but according to a White House fact sheet, India has committed to ending its imports of Russian crude oil.
To oversee compliance, a special committee chaired by the U.S. Secretary of Commerce has been established to monitor both direct and indirect purchases. If violations are identified, the 25 percent tariffs can be reinstated. Bloomberg analyst Andy Mukherjee has described this arrangement as effectively placing India’s energy sovereignty under external supervision.
Kunal Singh, an expert at the Harvard Kennedy School, hasemphasisedthe unprecedented nature of the arrangement, arguing that accepting such oversight would institutionalise foreign influence over India’s Russia policy. Opposition leaderMallikarjun Khargehascalledthe agreement an ‘erosion of sovereignty’, stressing that external monitoring sets a politically sensitive precedent.
The Indian government’s position on the issue has also appeared ambiguous. WhileCommerce Minister Piyush Goyalhas referred the energy issue to the Ministry of External Affairs,External Affairs Minister Subrahmanyam Jaishankar— who previously argued that India should not accept external diktats — has redirected questions back to the commerce ministry.
A second line of criticism concerns the opening of the agricultural market. Although this issue was not emphasised in the joint statement of 6 February, a subsequent White House fact sheet dated 9 February included provisions for imports of US sorghum, distillers’ dried grains (feed derived from genetically modified corn) and pulses.
In a country where agriculture employs a significant proportion of the population, such measures are politically sensitive. Kharge pointed out that the government had not approved genetically modified feed since 2017, yet it now appears that restrictions have been lifted. He estimates that up to two million dairy farmers could be affected due to potential changes in feed composition and livestock characteristics. Farmers’ organisations have already held protests, describing the agreement as an excessive concession to Washington.
Experts also highlight the broader geoeconomic context. India’s 2026–2027 budget does not allocate funding for the development of the Port of Chabahar — an essential component of the International North–South Transport Corridor, which links India with Central Asia and Russia while bypassing Pakistan.
According to Middle East specialist Yury Mavashev, thereducedemphasis on Chabahar fits into a broader pattern of pressure aimed at weakening the India–Iran–Russia alliance. Similarly, geoeconomic analyst Tanvi Ratnaarguesthat the Trump administration’s tariff policy was less about correcting trade imbalances and more about leveraging pressure to reshape India’s strategic ties with Moscow.
Source: Global Research
