Pressmediaofindia
Related Articles
06-02-2026
Bureau Report
NEW DELHI: United States President Donald Trump has announced what he described as a “trade deal” with India to reduce market barriers between the two countries, which have a combined gross domestic product of $33 trillion.
On Monday, Trump said he would reduce trade tariffs on Indian goods from 50 to 18 percent after New Delhi agreed to stop buying Russian oil, one of the major sticking points between the two sides.
Trump said he reached the agreement with Indian Prime Minister Narendra Modi in a telephone call. The agreement comes at the end of the first year of Trump’s global trade war, of which India had been one of the worst casualties and which had seen relations between the two countries fall to new lows in recent months.
On Tuesday, India’s commerce minister, Priyush Goyal, confirmed that the two countries would sign a deal “shortly”. A joint statement will be released when the final details have been agreed, he said. However, he gave no further details about the contents of the agreement.
Beyond Trump’s announcement about tariffs on Indian goods, therefore, uncertainty about the future of US-India trade relations remains. For one, while Trump claims New Delhi has agreed to buy oil from the US instead, India has not publicly confirmed this.
And, while Trump claimed that Modi had agreed to eliminate Indian tariffs on US goods altogether, this has also not been confirmed by India.
Subsequent announcements from Trump and Modi about the agreement the two had reached also differed greatly, geopolitical observers and economists told media.
We unpack what we know, what we don’t, and why Modi is facing criticism at home following the announcement.
What have Trump and Modi said about this agreement?
On Monday, Trump wrote on his Truth Social platform that he had spoken with Modi calling him “one of my greatest friends” about several issues, including ending Russia’s war in Ukraine.
“He (Modi) agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela,” Trump said.
Then, Trump wrote that upon Modi’s request and out of “friendship and respect” for him, Washington “agreed to a Trade Deal”, whereby the US “will charge a reduced Reciprocal Tariff, lowering it from 25% to 18%”.
White House officials were quoted in US media confirming that the additional 25 percent tariffs levied on Indian goods last year as punishment for buying Russian oil would also be dropped. In total, that would bring 50 percent tariffs down to 18 percent.
In turn, India would reduce “their Tariffs and Non-Tariff Barriers against the United States, to ZERO”, Trump wrote.
Trump added that Modi had also committed to “‘BUY AMERICAN’, at a much higher level, in addition to over $500 BILLION DOLLARS of U.S. Energy, Technology, Agricultural, Coal, and many other products”.
“Our amazing relationship with India will be even stronger going forward,” he wrote.
Shortly after, Modi’s statement was posted on X. In it, he completely avoided mention of a “trade deal”, or of any agreement to stop purchasing Russian oil, or committing to buy $500bn worth of goods from the US.
Instead, Modi simply confirmed that “Made in India products will now have a reduced tariff of 18%,” and expressed his gratitude over “this wonderful announcement”.
Then, he hailed Trump, writing: “President Trump’s leadership is vital for global peace, stability, and prosperity. India fully supports his efforts for peace.”
