Daily News - Tuesday, 3 February 2026
India-U.S. Trade Deal Targets USD 500 Billion by 2030 (Business Today)
The United States and India announced a new trade agreement in February 2026, led by President Donald Trump and Prime Minister Narendra Modi, aiming to double bilateral trade to USD 500 billion (INR 41.5 trillion) by 2030. The U.S. reduced tariffs on Indian goods from 25% to 18%, while India’s Ministry of Commerce & Industry, under Minister Piyush Goyal, pledged to cut non-tariff barriers and expand imports of American products. India committed to halt crude oil purchases from Russia, redirecting procurement toward U.S. and Venezuelan suppliers, with the Ministry of Petroleum & Natural Gas overseeing the transition. The deal also includes expanded cooperation in agriculture, technology, and defense, with the U.S. Trade Representative (USTR) and India’s Department of Commerce coordinating sectoral frameworks. Bilateral trade in 2025 stood at USD 200 billion (INR 16.6 trillion), meaning the new target requires a 150% increase over five years. Officials emphasized that the agreement will boost job creation, strengthen supply chains, and align India more closely with U.S. strategic and energy policies.
India Plans to Lift Foreign Ownership Cap in State Banks to 49% (Financial Times)
The Finance Ministry of India is evaluating an increase in the FDI cap in public sector banks from 20% to 49%, aligning with broader banking reforms announced in Budget 2026. Financial Services Secretary M. Nagaraju stated that inter-ministerial consultations are ongoing, with the goal of enhancing the capital adequacy of PSBs without diluting government control. Currently, private sector banks allow up to 74% foreign investment, while PSBs are capped at 20%, creating a disparity in capital inflows. India’s credit-to-GDP ratio stands at 56%, and policymakers aim to raise it to 150%, requiring significant capital infusion into state-run banks. Public sector banks, including State Bank of India (SBI) and 11 others, collectively hold assets worth over ₹171 trillion (USD 1.86 trillion), making them critical to India’s financial system. The move is expected to attract global investors, with precedents such as Sumitomo Mitsui’s USD 1.7 billion (INR 141 billion) stake in Yes Bank and Mitsubishi UFJ’s USD 4.4 billion (INR 365 billion) investment in Shriram Finance, signaling strong foreign interest in Indian banking.
India-U.S. Farm Trade Deal Targets USD 50 Billion by 2030 (Hindu Businessline)
India and the United States have agreed to expand agricultural trade cooperation, announced jointly by Prime Minister Narendra Modi and President Donald Trump in February 2026. The deal involves India increasing imports of U.S. farm products such as soybeans, pulses, and dairy, while the U.S. will lower tariffs on Indian rice, mangoes, and shrimp. The Ministry of Agriculture & Farmers’ Welfare in India and the U.S. Department of Agriculture (USDA) will oversee implementation, with a target to boost bilateral farm trade to USD 50 billion (INR 4.15 trillion) by 2030, up from the current USD 12 billion (INR 996 billion). India also committed to modernizing cold-chain logistics and reducing subsidies that distort trade, while the U.S. pledged technical support in crop science and precision farming. Farmers’ unions in India, representing over 100 million smallholders, have expressed cautious optimism, noting potential benefits but also risks of market competition. The agreement is framed as part of the broader India-U.S. Strategic Trade Partnership, linking agriculture to energy and technology sectors.
India USA Seal Historic Trade Deal: Tariffs Cut to 18% (Reuters)
The United States and India reached a breakthrough trade agreement on February 2, 2026, announced after talks between President Donald Trump and Prime Minister Narendra Modi. The U.S. agreed to cut tariffs on Indian goods from 25% to 18%, while removing an additional 25% punitive duty imposed earlier over India’s Russian oil imports. In return, India pledged to end Russian crude purchases, with oversight from the Ministry of Petroleum & Natural Gas, and expand imports of U.S. energy, agriculture, and technology products. The deal sets a target to raise bilateral trade from USD 200 billion (INR 16.6 trillion) in 2025 to USD 500 billion (INR 41.5 trillion) by 2030, coordinated by the U.S. Trade Representative (USTR) and India’s Ministry of Commerce & Industry. Financial markets reacted sharply: the Sensex surged 3,600 points, the Nifty 50 rose 5%, and the rupee strengthened to 90.15-90.25 per USD in non-deliverable forward trading. Analysts note the deal reduces policy uncertainty, strengthens strategic ties, and positions India as a major buyer of U.S. goods across multiple sectors.
