New Delhi: After a telephone conversation on Monday, India and the United States reached a trade agreement under which Washington will reduce reciprocal tariffs on Indian goods to 18 per cent from the existing 25 per cent, US President Donald Trump announced.

Trump, in a social media post, said the deal had been struck “out of friendship and respect for Prime Minister Modi and, as per his request,” and would take effect immediately. In the post, he also asserted that India would go on to eliminate its tariffs and non-tariff barriers against the United States.

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Responding to Trump’s announcement, Prime Minister Narendra Modi said he was pleased that “made in India products will now have a reduced tariff of 18 per cent”. “Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement,” he wrote on ‘X’, without referring directly to the wider contours of the deal.
 

Trump said Modi also pledged to “buy American” across an expanded range of goods, including energy, technology, agriculture and coal, worth more than USD 500 billion, and that the leaders discussed broader geopolitical issues such as ending the war between Russia and Ukraine. He added that Modi had agreed “to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela”.

The agreement marks a shift from last year’s tariff tensions, when US levies on Indian imports climbed sharply after New Delhi continued heavy purchases of Russian crude, prompting punitive duties.

Modi described the cooperation as beneficial for both economies. “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, adding that he looked forward to deepening the relationship.

PTI