Trump to reduce India tariffs after Modi pledges to stop buying Russian oil

President Trump lowered the tariffs he placed on goods from India on Monday after Prime Minister Narendra Modi agreed to stop buying Russian oil.

Mr. Trump said the levy on Indian goods will drop to 18%, from 25%.

“He agreed to stop buying Russian oil and to buy much more from the United States and, potentially, Venezuela,” Mr. Trump wrote on Truth Social following his call with Mr. Modi.

“Out of friendship and respect for Prime Minister Modi and, as per his request, effective immediately, we agreed to a trade deal between the United States and India, whereby the United States will charge a reduced reciprocal tariff, lowering it from 25% to 18%,” Mr. Trump wrote.

In exchange for the lower tariff rate, India will reduce its tariffs and nontariff barriers against the U.S. to zero and commit to buying $500 billion of U.S. energy, technology, agricultural, coal and other products, Mr. Trump said.

“This will help end the war in Ukraine, which is taking place right now with thousands of people dying each and every week,” Mr. Trump wrote.

In a statement, Mr. Modi thanked Mr. Trump for lowering tariffs on his country.

“When two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation,” Mr. Modi said.

Last July, Mr. Trump slapped India with a 25% tariff on imported goods for purchasing Russian oil that’s helped fund Moscow’s war in Ukraine. India was purchasing Russian energy and military equipment, purchases that Moscow had used to keep money flowing in while being hit with steep economic sanctions for waging its war against Kyiv.

While India’s new 18% rate is lower than the 25% rate Mr. Trump imposed last year, it’s still a dramatic increase from the 2.4% average tariff rate applied to Indian imports in recent years.

We Pay the Tariffs, a small-business coalition that opposes Mr. Trump’s tariffs, said the U.S.-India deal was nothing to celebrate.

“This ’deal’ locks in a rate six times higher than what we were paying a year ago,” said Dan Anthony, the coalition’s executive director. “That’s not relief, it’s a permanent tax hike that will be in place for a long time if Congress doesn’t fight back. American businesses will still be on the hook for billions in taxes annually that did not exist in 2024.”

Others saw the deal as a multi-faceted victory.

“India is a close partner of the United States, with a prominent diaspora in our country, and an integral partner in countering China’s malign influence in the Indo-Pacific,” said Senate Foreign Relations Committee Chairman James Risch, Idaho Republican.

“Now, under this new agreement India has pledged to buy American,” he said, adding the deal will “help the U.S. counter Russian aggression and in its work to bring an end to Russia’s war against Ukraine by cutting off India’s support of the Russian energy sector.”

The U.S. has a $45.7 billion trade deficit with India. The Trump administration repeatedly warned India about its high average tariffs on certain products, including 38% on U.S. agricultural goods, with rates hitting 45% on vegetable oil and around 50% on apples and corn.

India is one of the top sources of imports for American consumers and companies, with $90 billion of goods flowing into the U.S. from India last year. It was one of the world’s top smartphone suppliers after Apple shifted production away from China to avoid high tariffs and geopolitical conflicts.

Apple exported $17 billion of iPhones from India in 2024, according to the company’s recent data.

Other products imported from India include chemicals, plastics, leather goods, agricultural products and metals.

In 2022, India applied an average tariff rate of 5.2% on U.S. goods. Oil, cement, stone, glass and machinery rank as India’s top purchases from the U.S.

• Tom Howell Jr. contributed to this story.