US President Donald Trump has announced a new trade agreement with India that would sharply reduce tariffs on Indian exports to 18 percent from 50 percent, in return for New Delhi ending its purchases of Russian oil and easing trade restrictions.
Trump unveiled the agreement on social media after a phone conversation with Indian Prime Minister Narendra Modi. Under the deal, India is expected to source oil from the United States and possibly Venezuela, according to a Reuters report.
A White House official told Reuters that Washington would withdraw an additional 25 percent punitive duty imposed on Indian imports over India’s Russian oil purchases. That penalty had been applied on top of an existing 25 percent “reciprocal” tariff.
The announcement helped boost market sentiment, particularly among semiconductor and artificial intelligence stocks, pushing major US indexes into positive territory during the session.
Trump said Modi had also pledged that India would significantly increase purchases of American goods, including more than $500 billion in US energy products such as coal, along with technology, agricultural commodities and other items.
“They will also move ahead with eliminating both tariff and non-tariff barriers against the United States,” Trump said, claiming these would be reduced to zero.
Before Trump returned to office and raised US tariffs to double-digit levels last year, India maintained some of the highest import duties globally.
However, Trump’s post on Truth Social offered limited specifics, leaving unclear when the lower tariffs would take effect, how quickly India would end Russian oil imports, which trade barriers would be removed, and which US products India has formally committed to buying.
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