In February 2026, India and the US signed a landmark bilateral trade agreement that slashed US tariffs on Indian goods from 26% to 18%. Here is what happened, what India gave in return, and what it means for gold prices, the rupee and Indian stocks.
The US had initially imposed a 26% tariff on Indian goods (later temporarily raised to even higher levels). After intense negotiations, the two countries reached an agreement in February 2026:
The India-US deal temporarily calmed India-specific trade fears and strengthened the rupee slightly — which caused a brief dip in Indian gold prices. However, the bigger trade war between the US and China continued, keeping global gold prices elevated. Net result: Indian gold prices remained high despite the bilateral deal, as the global uncertainty factor outweighed the rupee improvement.
The trade deal was largely positive for Indian equities — particularly IT stocks (which had faced fears of reduced US outsourcing), pharma companies and textile exporters. Nifty saw a relief rally of 3-5% in the days following the deal announcement. However, the gains were capped as global uncertainty from the US-China war continued.
India committing to zero tariffs on US goods is a significant concession. It could mean cheaper US goods in India — from iPhones to agricultural products to medical devices. However, it also raises concerns about Indian manufacturers competing with cheaper US imports. Sectors like agriculture and consumer electronics could face increased competition.