Trump announces US-India trade deal, tariffs cut to 18%
US President Donald Trump announced a significant trade agreement with India on Tuesday, saying Washington and New Delhi have agreed to reduce reciprocal tariffs and expand economic cooperation after months of negotiations. The deal was unveiled following a telephone call between Trump and Indian Prime Minister Narendra Modi.
Under the new understanding, the United States will lower its tariff on Indian imports to 18 percent, down from tariffs that had previously reached effective levels as high as 50 percent due to added penalty duties linked to India’s purchase of Russian crude oil. A White House official confirmed that the punitive levy tied to Russian oil imports will be removed as part of the deal.
Trump framed the agreement as an expression of strong bilateral ties, noting that Modi had committed to “buy American” on a much larger scale and to cease buying oil from Russia, instead increasing energy imports from the United States and possibly Venezuela. While the $500 billion figure cited by Trump for future purchases has not been confirmed by Indian officials, the announcement signals a reset in trade relations after a period of tariff tensions.
Indian Prime Minister Modi welcomed the tariff cut on his social media platform, saying reduced duties on Indian products would make them more competitive in the US market and boost economic cooperation between the world’s two largest democracies. He highlighted the potential for mutual growth and called the deal beneficial for people in both countries.
Analysts said the agreement also gives India a relative tariff advantage over some regional competitors, with the 18 percent rate lower than levels faced by several major exporters, although duties on specific goods—such as steel and aluminium—remain elevated.
Financial markets reacted positively, with Indian stocks and the rupee strengthening sharply after the news, reflecting renewed investor confidence in India’s export outlook and broader economic ties with the United States.
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