U.S. And India Announce Trade Deal, Tariff Cuts, and Shift in India’s Oil Purchases
Washington D.C. And New Delhi have reached a trade agreement that will see the United States cut tariffs on Indian goods to 18%, while India has agreed to end its purchases of Russian oil. The deal, announced today, , follows months of diplomatic tension and negotiation between the two countries.
The agreement, described as an “initial trade deal,” was announced by former President Donald Trump, who linked the tariff reductions directly to India’s commitment to cease buying oil from Russia. According to reports, this move unlocks “immense opportunities” for both nations. Prime Minister Modi expressed his “big thanks” following the tariff cut.
The tariff reduction from previous levels to 18% is expected to provide a significant advantage to India in trade with the U.S., particularly when compared to its competitors like China, Pakistan, and Bangladesh. This development is seen as a positive step for the Indian economy.
The deal reportedly involves a potential $500 billion in trade. The agreement was reached following a phone call between Trump and Modi.
The move to end Russian oil purchases is a key component of the agreement. Financial Times reported that Trump “slashed” India tariffs after Modi “agrees” to stop buying Russian oil. The BBC also reported that the U.S. Agreed to drop tariffs after India stopped purchasing Russian oil.
The Washington Post noted the deal comes after “months of diplomatic tensions,” suggesting a complex negotiation process. CNBC reported that markets “shrugged off” precious metals routs following the announcement, indicating a generally positive reception to the trade agreement.
CNN reported that Trump announced the tariff cuts after Modi agreed to halt Russian oil purchases. Reuters confirmed the U.S. Will cut tariffs on India to 18% and that India has agreed to end its purchases of Russian oil.
Politico described the agreement as a “long-awaited trade deal” between the two countries. Hindustan Times highlighted the potential benefits for India, noting the deal’s impact on trade relations and economic opportunities.
The agreement represents a significant shift in India’s energy policy and a strengthening of trade ties with the United States. The long-term implications of this deal remain to be seen, but it marks a notable moment in the economic relationship between the two nations.
