US President Donald J. Trump announced in a post today that they have reached a new trade agreement with India and that reciprocal tariffs will be reduced.
According to Trump, the reciprocal tariffs the US imposes on India will be reduced from 25% to 18%.
In a message published on the social media platform Truth Social, Trump said he had a warm phone call with Indian Prime Minister Narendra Modi earlier that morning. Trump described Modi as “one of his greatest friends” and a “strong, respected leader.”
Trump stated that many topics were discussed during the meeting, including trade and the Russia-Ukraine war. In his message, Trump said that Modi had agreed to stop buying Russian oil and that India would henceforth buy more energy products from the US and potentially Venezuela. Trump claimed this step would “help end the war in Ukraine.”
Trump announced that, as part of the agreement, the US would reduce tariffs on India from 25% to 18%. In return, he said India was ready to reduce its tariffs and non-tariff barriers against the US to zero.
The president also stated in his message that India would purchase more than $500 billion worth of US-made products. Referring to the relationship between the two countries, Trump said, “Modi and I are two people who get results.”
This statement comes amid ongoing trade tensions between the two countries. The Washington administration had increased tariffs on goods imported from India to as much as 50%, a significant source of strain in bilateral relations.
Trade negotiations between the US and India have previously faced various difficulties, but recent talks between leaders are said to be progressing in the shadow of the comprehensive free trade agreement completed between India and the European Union in recent weeks.
*This is not investment advice.