US Reduces Tariffs On Indian Goods To 18% After Trade Deal

India and the US agreed to a trade deal under which Washington will bring down the reciprocal tariff on Indian goods to 18 per cent from the current 25 per cent, US President Donald Trump said on Monday after a phone conversation with Prime Minister Narendra Modi.

"Made in India products will now have a reduced tariff of 18 per cent," the prime minister declared, expressing his happiness.

"Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18 per cent. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement," Modi said.

The prime minister said that when two large economies and the world's largest democracies work together, it benefits the people and "unlocks immense opportunities for mutually beneficial cooperation".

"President Trump's leadership is vital for global peace, stability, and prosperity. India fully supports his efforts for peace," he said on 'X'.

Without addressing many of the other topics that were mentioned in Trump's social media post, Modi stated that he looked forward to working closely with Trump to take the bilateral cooperation to unprecedented heights.

Trump stated that New Delhi would purchase American commodities, including energy, valued at more than USD 500 billion, and that India would proceed to eliminate "tariffs and non-tariff barriers" against the US.

"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 per cent to 18 per cent," the US president said on social media.

India will "likewise move forward to reduce their tariffs and non-tariff barriers against the United States to zero", he said.

Trump said Modi also committed to buy American goods at a much higher level, in addition to over USD 500 billion dollars of US energy, technology, agricultural, coal, and many other products.

"Our amazing relationship with India will be even stronger going forward. Prime Minister Modi and I are two people who get things done, something that cannot be said for most," he said.

In his remarks, Modi said, "When two large economies and the world's largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation." "I look forward to working closely with him to take our partnership to unprecedented heights," he added.

Trump said Modi, and he also discussed ending the war between Russia and Ukraine.

"He agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela," the US president said.

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

The last phone conversation between Trump and Modi took place in October 2025. At a meeting in February of last year, the two presidents decided to complete the first part of a bilateral trade deal by the autumn.

Though the two sides held several rounds of negotiations, forward movement on the trade deal stalled after Trump imposed 50 per cent tariffs on Indian goods, including the 25 per cent punitive tariffs for India's procurement of Russian crude oil.

The day that Modi and Trump spoke over the phone coincided with External Affairs Minister S Jaishankar's trip to Washington, DC.

According to officials, India's tariff is currently lower than that of rival export nations.

They cited 19 per cent American tariffs on Indonesia, 20 per cent on Vietnam, 20 per cent on Bangladesh and 34 per cent on China.

Official sources last week said India and the US have made "very significant" progress in the negotiations for the trade deal.