Will India-US trade pact open doors to cheaper Harley-Davidson motorcycles

Speculation is growing around the possible price reduction of Harley-Davidson motorcycles in India following the announcement of a new trade deal between India and the United States. As details of the interim agreement between the two economies begin to emerge, the focus has shifted to the auto sector particularly premium motorcycles.

According to officials quoted by PTI, India is set to grant zero-duty access to US motorcycle manufacturers for bikes with engine capacities ranging from 800 cc to 1,600 cc and above. The duty elimination is expected to come into effect on the day the agreement is implemented.

This move is likely to benefit Harley-Davidson, one of the most sought-after American motorcycle brands in India. The company’s portfolio includes popular models such as the Street 750 and Iron 883.

Background of the Bilateral Agreement

The development follows the announcement made by India and the US on Saturday that they have reached a framework for the first phase of a bilateral trade agreement aimed at boosting trade by reducing import duties. The first phase of the pact is expected to be signed by mid-March.

Under the agreement, the US will lower reciprocal tariffs on Indian goods to 18 per cent, down from the earlier 50 per cent. Notably, India had already reduced import duties on motorcycles with engine capacities of up to 1,600 cc from 50 per cent to 40 per cent last year.

Impact on Local Manufacturing

The zero-duty access is unlikely to hurt domestic production, as India has a relatively small market for high-end premium bikes and US brands hold only a limited share in the segment. However, the move carries symbolic and strategic importance.

US President Donald Trump has repeatedly raised concerns over India’s high import duties on Harley-Davidson bikes, arguing that tariffs limited the brand’s market access.

Harley–Hero Partnership and Broader Context

In 2020, Hero MotoCorp and Harley-Davidson entered into a partnership for the Indian market. Under the agreement, Hero MotoCorp was tasked with developing and selling premium motorcycles under the Harley-Davidson brand in India, while also handling the sale of Harley accessories, riding gear and merchandise.

India has previously allowed zero-tariff imports of several US goods where domestic production is insufficient or quality standards need to be met. Union Minister Piyush Goyal has said products such as alcoholic beverages, cosmetics and medical devices will also face zero tariffs.

While the premium motorcycle segment remains niche, the proposed zero-duty access could reshape market dynamics and strengthen trade ties, making the new deal one to watch closely.