India, U.S. grant zero-duty access
Creates tariff-free access for Indian aerospace component suppliers to the U.S., aligning India with established supplier countries in Europe, Japan and South Korea and removing a tariff barrier for component exports.
Change
A trade agreement provides zero-duty access for aerospace components exported from India to the United States.
Why it matters
The agreement removes import duties on aerospace components exported from India to the United States and cuts aerospace product tariffs from 50% to 18%. Current Indian aerospace exports are reported at about $1.5 billion annually for Airbus components and $1.25 billion for Boeing components. Boeing has indicated it will double its sourcing from India and has roughly $50 billion in orders from Indian airlines including the Air India Group and Akasa. Government estimates place potential aircraft, engine, and spares orders from Indian carriers at $70–80 billion; operational clarity on the agreement is expected in the coming days.
Implications
- — Import duties on Indian aerospace components exported to the U.S. are removed.
- — Aerospace product tariff rates are reduced from 50% to 18%.
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