US, India Seal Trade Deal: After months of rising trade pressure, the United States and India have agreed on a long-pending trade deal on Monday night. US President Donald Trump took to Truth Social a
Published: February 3, 2026 7:56 AM IST
US, India Seal Trade Deal: What Did Donald Trump Say?
After talking to PM Modi on phone, Trump took to Truth Social and wrote, “It was an honour to speak with Prime Minister Modi, of India, this morning. He is one of my greatest friends and, a powerful and respected leader of his country. 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.” It is to be noted that President Trump and PM Modi had a telephonic conversation but no details were shared by either government. US ambassador to India Sergio Gor took to X and wrote ‘stay tuned’. Also Read: Asia markets eye gains after US, India seal trade deal, tariff cut plansAdd India.com as a Preferred Source
Story Highlights
| No. | Key Aspect | Details |
|---|---|---|
| 1 | Reciprocal Tariff Cut | The US will reduce the reciprocal tariff on Indian goods from 25% to 18%, effective immediately, following talks between President Trump and PM Modi. |
| 2 | Russian Oil Penalty Dropped | Washington has scrapped the additional 25% penalty imposed on Indian goods over India’s purchase of Russian crude oil. |
| 3 | August 2025 Tariff Rollback | The deal reverses the August 2025 escalation, when the US imposed tariffs of up to 50% on Indian exports. |
| 4 | India to Boost US Imports | India has agreed to purchase over USD 500 billion worth of US goods, including energy, technology, agriculture, coal, and other products. |
| 5 | Leaders React | PM Modi thanked President Trump for the reduced tariffs, calling it a positive step for ‘Made in India’ products and bilateral trade. |
US-India Trade Deal Announcement: Five Key Points
Major Tariffs Cut: The immediate result of the trade deal is a major cut in tariffs on Indian goods entering US. A White House official told news agency Reuters that the Trump administration has reduced the tariff on Indian imports to 18 percent, from 25 percent. Following the announcement, much higher duties will be replaced, bringing clarity for Indian exporters who had been bracing for trade disruption. US Drops Additional 25% Penalty Over Russian Oil: Another major decision was that Washington has dropped the additional 25 percent tariffs which it imposed on Indian goods over India’s purchase of Russian oil. Trump wrote on Truth Social that PM Modi had agreed “to stop buying Russian oil, and to buy much more from the United States and, potentially, Venezuela.” August 2025 Tariff Escalation To Be Rolled Back: The development reverses August last year’s escalation when White House imposed 50 percent tariffs on Indian goods sent to America over New Delhi’s continued purchases of Russian crude oil. The decision impacted sectors like – auto components, engineering goods, textiles, and chemicals which depend heavily on American market. India To Buy Over USD500 Billion Worth Of US Goods: Following the tariff relief the PM Modi assured large-scale purchases from the US, Trump said. The US President stated that New Delhi agreed to buy “over USD500 billion dollars of US energy, technology, agriculture, coal and many other products. PM Modi Thanked Trump For Trade Deal: PM Modi thanked President Trump “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. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement,” he said.Source link
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