Trump announces trade deal with India after conversation with Narendra Modi
The U.S. president reported the agreement via Truth Social, describing Modi as "one of my greatest friends" and detailing that an immediate understanding was reached on tariffs and energy trade.
Indian Prime Minister Narendra Modi and President Donald Trump (File).
President Donald Trump announced a trade deal with India on Monday after a phone call with Prime Minister Narendra Modi, in which both leaders sealed a series of commitments that modify the bilateral economic relationship and align New Delhi with part of Washington's foreign policy.
Trump reported the agreement via his social network Truth Social, describing Modi as "one of my greatest friends" and detailing that an immediate understanding was reached on tariffs and energy trade.
According to the leader, the U.S. will reduce its reciprocal tariffs on Indian goods from 25% to 18%, while India agreed to eliminate tariffs and expand its purchases on American goods, with a commitment valued at hundreds of billions of dollars in sectors such as energy, technology, agriculture and others.
A White House official confirmed to AFP that the move includes the removal of the additional 25% tariff that Trump had imposed as pressure over India's purchase of Russian oil, after which New Delhi decided to stop importing crude from Moscow.
The U.S. president also stated that India could increase its purchase of oil from Venezuela, rather than buying it from Russia, as part of a strategy to counter Moscow's ability to fund its war machine.
Context of trade and geopolitical tensions
U.S.-India trade relations had been strained last year after Trump imposed tariffs of up to 50% on certain Indian goods, combining a reciprocal 25% rate with an additional 25% related to Russian oil imports.
The decision to reduce tariffs comes after months of negotiations and pressure from Washington for India to lessen its energy dependence on Russia, especially in the wake of Russia's invasion of Ukraine in 2022. New Delhi's turn to alternative energy sources, including Venezuelan crude, represents a significant shift in its energy strategy.
Reactions and implications
The deal also comes at a time when India has sought to diversify its trade relations and signed recent agreements with the European Union and other global partners, amid a swinging geopolitical environment and a growing economy.
While the full details of the deal are still being fine-tuned, experts say the tariff reduction could ease bilateral economic tensions and open up new investment opportunities, while reconfiguring some of the global energy policy tied to sanctions against Russia.
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