U.S. President Donald Trump announced a major trade agreement with India following a phone call with Indian Prime Minister Narendra Modi — aiming to reset strained economic relations and boost bilateral commerce.
Tariffs on Indian goods will be cut: Washington will reduce its reciprocal tariff on Indian imports to 18%, down from higher levels imposed during last year’s trade tensions. A dedicated punitive tariff linked to India’s prior Russian oil purchases will also be dropped.
India’s tariff stance: Trump said India will now move toward eliminating its own tariffs and non-tariff barriers on U.S. goods, aiming for broader market access.
Energy and purchases: Trump also stated that India agreed to stop buying Russian oil and would expand purchases of American products — including energy, technology, agricultural and industrial goods — potentially reaching $500 billion in total over time.
Market reaction: Indian equity markets saw strong gains on the news, reflecting investor optimism about eased trade tensions.
Prime Minister Modi expressed he was “delighted” at the tariff reduction and highlighted the improved bilateral cooperation emerging from the agreement.
The announcement follows India’s recent landmark free-trade agreement with the European Union, underscoring New Delhi’s broader strategy to deepen global economic ties.
While Trump linked the deal to commitments on energy sourcing and purchases from the U.S., some details — including the full scope and legal commitments — have not yet been formally confirmed by Indian government statements.
