India and the United States have finalised a trade deal following talks between US President Donald Trump and Prime Minister of India Narendra Modi, under which the US will cut reciprocal tariffs on Indian goods from 25 per cent to 18 per cent
India–US Trade Deal Finalised, Reciprocal Tariffs Cut
India and the United States have agreed to a major trade deal after months of negotiations, according to an announcement by Donald Trump. In a post on Truth Social, a social media platform he owns, Trump said the US will reduce reciprocal tariffs on India from 25 percent to 18 percent.
Tariff Reduction Announced After Modi–Trump Call
US President Donald Trump announced a reduction in reciprocal tariffs on Indian goods to 18 percent, lowering the rate from 25 percent, following a phone conversation with Narendra Modi and what he described as the sealing of a trade deal between the two countries.
Overall Tariff Burden on India Slashed
The big announcement, made after a telephonic conversation between the two leaders, brings down the overall tariff on India to 18 per cent from the earlier 50 per cent, which included the 25 per cent punitive levy on New Delhi for purchasing Russian oil.
Trump Shares Details on Truth Social
Sharing details of the call on Truth Social, Trump said, “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 percent to 18 percent.”
Praise for Modi and Discussion on Global Issues
Trump described Modi as “one of my greatest friends” and a “powerful and respected leader of his country,” adding that the two leaders discussed trade, global security and efforts to end the Russia Ukraine war.
Modi Welcomes Tariff Cut, Highlights Cooperation
Responding to the announcement, Prime Minister Modi welcomed the tariff reduction and underlined the broader significance of India–US cooperation. “Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18 percent,” Modi said. “Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement.”
Emphasis on Democratic Partnership and Opportunities
The Prime Minister said closer coordination between India and the United States would unlock new opportunities for both countries. “When two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation,” he said.
Support for Trump’s Global Leadership
Modi also expressed support for Trump’s global leadership, saying, “President Trump’s leadership is vital for global peace, stability and prosperity. India fully supports his efforts for peace.” He added that he looked forward to working closely with Trump to take the partnership “to unprecedented heights.”
India to Shift Energy Purchases, Says Trump
According to the US President, Prime Minister Modi also agreed that India would stop buying Russian oil and instead increase purchases from the United States and potentially Venezuela. Trump claimed the move would help bring an end to the war in Ukraine, which he said was “taking place right now, with thousands of people dying each and every week.”
Commitment to Zero Tariffs and ‘Buy American’
Trump further said India would move ahead to reduce tariffs and non-tariff barriers on American products to zero. He added that Modi had committed to “BUY AMERICAN” at a much higher level, including energy, technology, agricultural products, coal and other goods. Trump claimed these purchases could exceed 500 billion dollars.
‘Relationship Will Be Even Stronger’
“Our amazing relationship with India will be even stronger going forward,” Trump wrote, adding that both leaders were people who “GET THINGS DONE.”
US Ambassador Confirms Removal of Punitive Tariff
Speaking to CNN-News18, US Ambassador to India Sergio Gor confirmed that the 25 per cent punitive tariff on India was also removed as part of the trade deal announced by Trump.
Sergio Gor Reacts on X
Sergio Gor also wrote on X: “As I have said many times, President Trump genuinely considers Prime Minister Modi a great friend! Thrilled by the news of the trade deal this evening. The relationship between the United States and India has LIMITLESS POTENTIAL!”
Deal Follows India–EU Free Trade Agreement
The announcement by Trump comes just days after the announcement of a free trade agreement between India and the European Union, which has been widely termed as “mother of all deals.”
US Trade Delegation’s Earlier Visit to India
A delegation from the Office of the United States Trade Representative, led by Deputy Trade Representative Rick Switzer, was in the national capital in December 2025 for trade talks.
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