India and the United States have agreed to introduce zero-tariff trade on aerospace parts and components under an interim trade framework, marking a significant step in strengthening bilateral manufacturing and supply-chain cooperation. The move is expected to enhance India’s position as a competitive supplier in the global aerospace ecosystem while improving market access for manufacturers in both countries.
Under the framework, select aircraft parts and aerospace components exported between India and the US will attract zero import duties. This is aimed at creating parity with other global aerospace supply chains, lowering costs for manufacturers and supporting higher export volumes from Indian aerospace units to one of the world’s largest aviation markets.
The zero-tariff arrangement forms part of a broader effort to deepen trade ties and could eventually be expanded into a comprehensive bilateral trade agreement. Alongside aerospace components, discussions are ongoing to extend preferential tariff treatment to other sectors in future phases, including automotive components, pharmaceuticals and engineering goods.
Industry stakeholders have welcomed the development, noting that duty-free access will significantly improve cost competitiveness for Indian suppliers and encourage deeper integration into global production networks. Indian aerospace manufacturers already export aircraft components worth over a billion dollars annually, and the tariff removal is expected to accelerate growth by enabling wider participation in international supply chains.
The interim trade framework also aims to expand overall market access between the two countries, with reciprocal tariff reductions planned across a range of goods. The initiative aligns with India’s broader strategy to boost exports, strengthen domestic manufacturing capabilities and enhance its role in global value chains.
The agreement is expected to be formalised in the coming weeks, with both sides working toward implementation while continuing negotiations on additional market-access commitments. The zero-tariff provision on aerospace parts is being seen as a key enabler for long-term industrial collaboration between India and the United States.
