US President Donald Trump announced a surprise US-India trade deal after a call with PM Narendra Modi, cutting tariffs on Indian goods to 18%. He claimed India will stop buying Russian oil, while Modi hailed the “wonderful” call.
US President Donald Trump on Monday announced what he described as a “trade deal” with India following a phone call with Prime Minister Narendra Modi, claiming New Delhi has agreed to stop buying Russian oil in return for a sharp rollback of US tariffs. Trump said the agreement would see the United States reduce its reciprocal tariff rate on Indian goods from 25 percent to 18 percent, while India would cut tariffs on US products to zero.
Russian Oil Purchases Central to Agreement
According to Trump, the deal hinges on India ending its purchases of Russian crude — an issue that has strained trade ties amid the ongoing war in Ukraine.
A White House official told AFP that an additional 25-percent tariff imposed by Trump on India specifically over its Russian oil imports would also be withdrawn, following India’s agreement to stop buying it.
The US president has been pressing New Delhi for months to reduce its reliance on Russian energy, arguing that curbing Moscow’s oil revenue would help push a ceasefire in Ukraine.
‘Out of Friendship and Respect’
“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, whereby the United States will charge a reduced reciprocal tariff, lowering it from 25 per cent to 18 per cent,” the US president said on social media.
India will “likewise move forward to reduce their tariffs and non tariff barriers against the United States, to zero”, he said.
Trump said Modi also committed to “buy American” at a much higher level, in addition to over USD 500 billion dollars of US energy, technology, agricultural, coal, and many other products.
“Our amazing relationship with India will be even stronger going forward. Prime Minister Modi and I are two people that get things done something that cannot be said for most,” he said.
Describing Modi as “one of my greatest friends,” Trump said that “he agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela.
“This will help END THE WAR in Ukraine.”
Venezuela in the Energy Equation
Trump also pointed to Venezuela as a possible alternative supplier for India. The United States is effectively overseeing Venezuelan oil exports following a military operation in January that toppled the South American country’s leader, Nicolas Maduro.
The reference highlights Washington’s broader push to reshape global energy supply chains while isolating Russia economically.
Modi Thanks Trump, Stops Short of Confirming Claims
Prime Minister Modi responded shortly after Trump’s announcement, describing their conversation as positive and welcoming the tariff relief.
“Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%,” Modi said in a post on X.
“Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement,” he added.
However, Modi’s statement did not reference Trump’s claims that India would reduce tariffs on US goods to zero or halt purchases of Russian oil.
“When two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation. President Trump’s leadership is vital for global peace, stability, and prosperity. India fully supports his efforts for peace. I look forward to working closely with him to take our partnership to unprecedented heights,” he further stated.
Tariff Rollbacks After ‘Liberation Day’ Levies
Trump hit India, the world’s most populous nation, with 25 percent reciprocal levies during his waves of “Liberation Day” tariffs last year.
He then stacked another 25 percent 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.
Trump also said in October that Modi had promised to stop buying Russian oil, but an agreement did not materialize at the time.
(With inputs from AFP)