India-US trade deal announced by US President Donald Trump; tariff slashed to 18%, claims India will stop buying Russian oil – The Times of India
India-US trade deal announced: US President Donald Trump on Monday announced that India and the US have finalised a trade deal. Ahead of the announcement, Trump spoke to PM Modi. The deal comes after several months of negotiations, in between which the Donald Trump administration levied a steep 50% tariff on Indian exports to the US. 25% of these tariffs were for India’s crude oil trade with Russia, which the US claimed was indirectly financing Russia’s war against Ukraine.The India-US trade deal was confirmed by PM Modi who posted on X (formerly Twitter), “Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement. 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.”The deal was first announced by Trump on social media platform Truth Social, “It was an Honor to speak with Prime Minister Modi, of India, this morning. He is one of my greatest friends and, a Powerful and Respected Leader of his Country. We spoke about many things, including Trade, and ending the War with Russia and Ukraine. 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, which is taking place right now, with thousands of people dying each and every week! 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% to 18%. They will likewise move forward to reduce their Tariffs and Non Tariff Barriers against the United States, to ZERO. The Prime Minister also committed to “BUY AMERICAN,” at a much higher level, in addition to over $500 BILLION DOLLARS of U.S. 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. Thank you for your attention to this matter!”Earlier today, US Ambassador to India Sergio Gor shared on X (formerly Twitter): President Trump just spoke with Prime Minister Modi. STAY TUNED…
India-US Trade Deal: Top Highlights From Trump’s Announcement
- Reciprocal tariffs on India reduced to 18%
- Trump has said that India will reduce its tariffs on US products to 0%
- India will stop buying Russian oil, Trump has claimed
- India has committed to buy $500 billion of US energy, tech, agriculture, coal, Trump has said.
- The new tariff rate is effective immediately
The deal comes days after India and the EU announced what both sides called the ‘mother of all’ trade deals. While European Union is India’s largest trading partner as an economic bloc, US continues to be the single largest trading partner.On Saturday, Trump claimed that India would begin purchasing crude from Venezuela, a move he said would help substitute part of the Russian oil supplies. India is the world’s third-largest importer of crude oil. Speaking to reporters on board Air Force One, Trump said, “We’ve already made that deal, the concept of the deal.” India had stopped oil imports from Venezuela last year after the Trump administration imposed a 25% tariff in March on nations purchasing Venezuelan crude.During the same interaction, Trump also indicated that India would source Venezuelan oil in place of Iranian supplies. However, India had already stopped importing Iranian crude in 2019 following US sanctions linked to Tehran’s nuclear programme. To offset the loss of Iranian oil, Indian refiners initially increased purchases from the US, before later scaling those back and emerging as the largest buyer of discounted Russian seaborne crude after Western countries sanctioned Moscow over its 2022 invasion of Ukraine.A few weeks back, US Treasury Secretary Scott Bessent had hinted that Washington may eventually roll back the 25% punitive tariff imposed on India over its purchases of Russian crude, arguing that the measure has delivered results. He framed the outcome as a victory for US pressure tactics, while also expressing apparent discomfort with the European Union’s engagement with New Delhi as it moves closer to finalising a free trade agreement.Speaking at Davos, Bessent said the tariff was introduced after India continued importing Russian oil and claimed that refinery purchases from Russia have since dropped sharply. “We put 25% tariffs on India for buying Russian oil, and the Indian purchases by their refineries of Russian oil have collapsed. So that is a success. The tariffs are still on. I would imagine there is a path to take them off, so that’s a check and a huge success,” he said.