India-US Trade Deal
Trump says concluded trade deal with India, to cut reciprocal duty to 18%
This story was originally published at 23:48 IST on 2 February 2026
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--US Trump: Concluded trade deal with India, to cut reciprocal duty to 18%
--Trump: India agreed to cut Russian oil purchase, to buy from US, Venezuela
--Trump: India committed to buy $500 bln of farm, energy, coal pdts from US
--US Trump:India committed to cut tariff, non-tariff barriers for US to zero
NEW DELHI – India and the US have concluded a trade deal as per which Washington will cut its reciprocal tariffs on Indian goods to 18% from 25%, US President Donald Trump said Monday. While Trump did not clarify whether he has scrapped 25% punitive tariffs on India for New Delhi's trade and strategic relations with Russia, Prime Minister Narendra Modi said in a post on X that Indian goods will be subject to an 18% tariff in the US.
The White House had imposed a 50% tariff on Indian goods in August, which included a 25% reciprocal tariff and 25% punitive tariff. Some Indian media reports said the US ambassador to India, Sergio Gor, has confirmed that the 50% has been cut to 18%. A final public confirmation is awaited.
India has committed to cut tariff and non-tariff barriers for American goods to zero, Trump said in a post on Truth Social. Modi's post, however, did not confirm the commitment of zero duty on American goods. Trump's announcement comes barely an hour after US ambassador to India Sergio Gor said that President Trump spoke with Modi.
According to Trump's post, New Delhi has also assured that India will stop buying Russian oil, and instead buy energy products from the US and potentially Venezuela. Modi did not specify this either in his post.
"The Prime Minister also committed to "BUY AMERICAN," at a much higher level, in addition to over $500 BILLION DOLLARS of US energy, technology, agricultural, coal, and many other products," Trump said in his post. Modi did not mention anything about opening Indian markets to US farm goods. The trade deal negotiations, which had begun nearly a year ago, had reached a stalemate in August over both parties' disagreement over the farm sector.
The two sides concluded the trade deal during Indian External Affairs Minister S. Jaishankar's three-day visit to the US that started Monday.
Gift Nifty contracts jumped after the tariff cut announcement, indicating a sharp rise in stocks on Tuesday. At 2321 IST, its February contracts rose over 3%, rising more than 800 points, to 25961 points. On Monday, the Nifty 50 closed at 25088.40 points, up 262.95 points, or 1%. The rupee also appreciated to 90.95 a dollar in the offshore non-deliverable forwards market after the news. It closed at 91.5125 in the spot market on Monday. End
US$1 = INR 91.51
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Reported by Krity Ambey
With inputs from Asim Khan, Pratiksha and Anshul Choudhary
Edited by Deepshikha Bhardwaj
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