US President Donald Trump announced that an agreement has been reached on a trade agreement with India, under which Washington will reduce additional tariffs on Indian goods and Delhi will stop purchasing Russian crude oil, BTA reports.
Trump said on his social network Truth Social that Washington will reduce the 25 percent import duties on goods from India to 18 percent, and Delhi, in turn, will reduce its customs rates on imports of goods from the US "to zero," the Washington Post reports. A White House official told the publication that the Trump administration would also lift additional 25 percent tariffs on India, which were imposed in August as a punitive measure for its purchases of Russian oil.
Indian Prime Minister Narendra Modi "has agreed to stop buying Russian oil and will buy much more from the United States and possibly Venezuela," Trump wrote. "Our incredible relationship with India will be even stronger," the American leader added.
A little later, Modi thanked Trump in a post on the social network X "for this wonderful announcement." "The cooperation between… "The largest democracies in the world benefit our people and unlock enormous opportunities," the Indian prime minister stressed.
It seems that with his statement he confirmed the new 18 percent tariffs, but did not mention Russian oil, nor Trump's claim that Delhi would eliminate tariffs on American goods, commented "The Washington Post".
It was expected that during Trump's second term, relations between Washington and Delhi would reach new heights, but after the armed conflict between India and Pakistan that broke out in May and after Trump's decision to designate Delhi as the world's leading buyer of Russian oil, their contacts deteriorated sharply, the American publication also writes.
India is the fourth largest economy in the world and is one of the leading trading partners of the United States. In 2024, the United States imported Indian goods worth $ 87.3 billion, according to official US government data. The 50 percent tariffs that went into effect in August were among the highest Trump has imposed on any country. The new 18 percent rate would be slightly more lenient than tariffs imposed on India's arch-rival Pakistan (19 percent) and on regional rivals Vietnam and Bangladesh, whose goods are subject to 20 percent tariffs, the Washington Post reported.
The 18 percent tariffs on Indian goods announced yesterday are far lower than those the United States imposed earlier this year, the New York Times reported. But some critics of Trump's tariff policy say that compared to tariffs in recent years, the 18% increase is a significant one and will hurt small businesses in the United States as well as American consumers who buy Indian goods.
"American importers were paying an average of about 2.5% on goods from India" before Trump implemented his new tariff policy, Dan Anthony, executive director of "We Pay the Tariffs", a trade group that represents more than 800 small businesses, told The New York Times. "This "deal" sets a rate that is six times higher than what we paid a year ago," Anthony added.
Some Indian industries, including pharmaceutical companies and manufacturers of auto parts and chemicals, are keen to expand trade ties between India and the United States, continues "The New York Times". But other sectors, in particular - agriculture, insist on maintaining relatively high tariffs and introducing more regulations to block imports of agricultural goods. The Indian government is reluctant to remove these barriers because they are necessary to protect small farmers, many of whom live in poverty, adds the American publication.
Q. "The Times of India" quoted US Agriculture Secretary Brooke Rollins, who wrote today on the social network Ex that the trade agreement would lead to an increase in exports of American agricultural goods and would give a boost to rural areas in her country. "Thank you to US President Donald Trump for AGAIN delivering on his promises to American farmers. The new US-India agreement will increase US agricultural exports to the huge Indian market, boost prices and inject money into rural America," Rollins wrote. She added that the US trade deficit with India in agricultural goods was $1.3 billion in 2024 and stressed that India's growing population is an important market for US products.
Newsweek focuses on the geopolitical context surrounding the new pact and cites American analysts who say the EU-India free trade agreement signed last week has strengthened Delhi's position in negotiations with Washington over tariffs.
The White House, for its part, has given a clear signal that the tariff relief is related to the desire to limit Russia's oil revenues. US Secretary of State Scott Besant recently said that imports of Russian crude oil into India have "collapsed". And Trump noted in his publication in Truth Social yesterday that India will begin to buy larger quantities of American oil and may in the future become a buyer of Venezuelan oil, adds Newsweek. This calculation has additional weight, taking into account the risks of a possible US strike against Iran. Any shock in the Persian Gulf could quickly cause turmoil in global oil markets and complicate the policies of international alliances, the publication points out.
In this context, the trade agreement between India and the United States is beneficial for both countries, "Newsweek" also writes. Trump provides himself with leverage through which to pressure Russia to make peace with Ukraine, and Modi receives tariff concessions.
But the deeper logic is related to strategic supply chains. Washington wants India to establish itself as an independent partner in manufacturing and defense from China, and Delhi wants evidence that cooperation with the United States quickly pays off, "Newsweek" concludes.