Donald Trump announced on Monday plans to reduce tariffs on Indian goods from 25% to 18%, following Indian Prime Minister Narendra Modi’s agreement to halt purchases of Russian oil. The U.S. president also said India would gradually reduce import taxes on American products to zero and purchase $500 billion in U.S. goods.
The announcement follows months of Trump pressuring India to reduce its reliance on cheaper Russian crude, which India has taken advantage of while much of the world seeks to isolate Moscow due to the Ukraine invasion. Modi expressed enthusiasm on social media, praising Trump’s leadership and signaling willingness to strengthen bilateral cooperation, though he did not explicitly confirm the Russian oil suspension.
Trump’s push to end the war in Ukraine has been a central issue, with the refusal of India to stop Russian oil imports causing tension. The U.S. president has also used tariffs to exert economic pressure, bypassing Congress, while his special envoy and son-in-law Jared Kushner plan further talks with Russian and Ukrainian officials in Abu Dhabi this week. Trump believes targeting Russian oil revenue is key to ending the conflict.
India has become a major buyer of Russian oil since the war began, providing Moscow with a crucial export market as Europe sharply reduced purchases. In 2024, Russia supplied nearly 36% of India’s crude imports, around 1.8 million discounted barrels per day. Russian President Vladimir Putin recently stated he was ready to continue “uninterrupted shipments” to India despite U.S. pressure.
Tariff threats and adjustments: In 2023, Trump imposed additional 25% tariffs on Indian goods due to its Russian oil purchases, raising the combined rate to 50%. With India’s commitment and the new rate, tariffs could drop to 18%, close to rates applied to the EU and Japan. A White House official confirmed the additional 25% tariff will be removed.
This announcement comes shortly after India and the European Union reached a free trade agreement covering nearly all goods, reducing import taxes on items from wine to cars. The deal reflects India’s efforts to diversify trade partners amid U.S. tariff disruptions and ongoing global supply chain shifts.
Source: Euronews
