A dialogue between PM Narendra Modi and US President Donald Trump paves the way for lower duties, expanded market access and a major boost to bilateral trade and energy cooperation
New Delhi: India and the United States have reached a significant breakthrough in trade relations, with US President Donald Trump announcing a new bilateral trade deal that reduces tariffs on Indian goods to 18%, marking a major easing of trade tensions between the two countries.
The development follows a dialogue between Prime Minister Narendra Modi and President Trump, confirmed earlier by US Ambassador to India Sergio Gor. The agreement lowers the reciprocal tariff from 25% to 18% and rolls back the punitive duties that had pushed total US tariffs on Indian exports as high as 50% in recent months.
In a social media post, Trump said the deal was reached “out of friendship and respect for Prime Minister Modi,” adding that India has agreed to increase purchases of American energy, technology, agricultural and other products, with commitments reportedly exceeding $500 billion. He also claimed that India would reduce non-tariff barriers and scale back its imports of Russian oil.
Welcoming the announcement, Modi wrote, “Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement.”
The Prime Minister further opines that, “When two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation.”
Looking forward to working closely with the US President, he wrote, “President Trump’s leadership is vital for global peace, stability, and prosperity. India fully supports his efforts for peace. “
Ambassador Gor described the partnership as having “limitless potential,” calling the deal a step toward deeper economic cooperation.
The agreement comes amid broader efforts by both nations to stabilise trade ties, strengthen supply chains and enhance strategic collaboration. Analysts say the tariff cut could boost Indian exports while opening new opportunities for investment, energy security and long-term growth in India-US relations.
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