WASHINGTON: US President Donald Trump on Monday announced a new trade deal with India, saying Washington will cut reciprocal tariffs on Indian goods from 25% to 18% after talks with Prime Minister Narendra Modi.
In a post on his social media platform Truth Social, Trump said he had spoken to Modi earlier in the day and described him as “one of my greatest friends”.
Trump said the agreement would expand bilateral trade and further strengthen ties between the two countries.
Tariff cuts and trade commitments
“Out of friendship and respect for Prime Minister Modi, and as per his request, effective immediately, we agreed to a Trade Deal between the United States and India,” Trump wrote, announcing the reduction in tariffs.
A White House official, cited by AFP, said that an additional 25% tariff imposed on India over its continued purchases of Russian oil would also be removed following India’s commitment to halt Russian oil imports.
The United States had initially imposed a 25% reciprocal tariff on Indian goods and later added another 25% penalty tariff, citing India’s reliance on Russian oil.
Trump said India would also “move forward to reduce their Tariffs and Non Tariff Barriers against the United States, to ZERO”.
India’s purchase of Russian oil
Trump said Modi had agreed to stop buying Russian oil and to purchase more energy from the United States and “potentially, Venezuela”.
“This will help END THE WAR in Ukraine,” Trump said, linking India’s shift away from Russian oil to efforts to pressure Moscow.
India is one of the world’s largest buyers of Russian crude, importing roughly 1.5 million barrels per day, according to data from global trade analytics firm Kpler.
The United States is effectively overseeing Venezuelan oil exports since toppling the South American country’s leader Nicolas Maduro in a military operation in January.
Trump hit India, the world’s most populous nation, with 25% reciprocal levies during his waves of “Liberation Day” tariffs last year.
He then stacked another 25% on top of that over India’s purchases of Russian oil.
Modi was one of the first leaders to visit the White House after Trump’s inauguration for his second term in January 2025, but that has not stopped difficult trade negotiations over the past year.
It was not immediately clear how quickly India could reduce or replace its Russian oil imports.
Analysts, cited by the US media, note that Venezuela’s oil sector suffers from severe infrastructure constraints, limiting its capacity to rapidly increase exports.
Investment pledges
Trump said Modi had committed to a “BUY AMERICAN” approach, including purchases worth more than $500 billion of US energy, technology, agricultural products, coal and other goods.
He also said India had pledged to invest in US products “at a much higher level”, without giving a timeframe or binding figures.
The United States imported about $95.5 billion worth of goods from India in 2025 and exported around $42 billion to India, according to the US Census Bureau.
While India is not among Washington’s largest trading partners, officials say tariff reductions could have a significant impact on trade flows.
