US, India Reach Trade Deal; Tariffs on Indian Imports Cut to 18%, Says US President Donald Trump

Washington DC: U S President Donald Trump announced on Monday — through Truth Social — that the United States and India have reached a trade agreement following a phone conversation with Indian Prime Minister Narendra Modi. He also announced that the tariffs on Indian imports will fall to 18 per cent under the new arrangement. The announcement reflects a notable shift in economic relations between the two countries after months of trade tensions.

Trump said the deal will come into effect immediately, signalling a reduction in reciprocal tariffs that the United States had earlier imposed as part of a broader tariff campaign. Under the agreement, the U S will lower its duty on Indian goods from 25 per cent to 18 per cent, a cut Washington said would ease barriers and promote bilateral trade. India has also committed to adjusting its own tariff and non-tariff measures on U S products.

The president linked the trade deal to energy and geopolitical cooperation, saying Modi agreed to end purchases of Russian oil — a long-standing point of contention — and to boost U S energy imports, including natural gas and crude, as part of efforts to reshape global energy flows. Trump suggested the shift could help reduce financial support to Russia amid its ongoing war in Ukraine.

Details of the pact also include India’s pledge to purchase billions of dollars’ worth of American goods and services across sectors such as energy, technology, agriculture and manufacturing, in what Trump described as a “historic” commercial boost for U S exporters.

The announcement follows a phase of strained trade relations that began in 2025 when the Trump administration imposed steep tariffs — at times cited as high as 50 per cent — on Indian exports, partly in response to India’s energy ties with Russia. Those higher levies had triggered concerns among Indian exporters and global markets and complicated diplomatic ties between the two countries.

This recent development follows other decisions made by the Narendra Modi government, while simply agreeing and bowing down to Donald Trump's threats and tantrums, while putting the entire country at stake.