US–India announce trade deal as Trump cuts tariffs to 18% after call with Modi

Mangalore Today News Network

New Delhi, Feb 3, 2026: President Donald Trump on Monday said he had spoken with Prime Minister Narendra Modi and announced on Truth Social that the United States and India had reached a trade deal. Under the arrangement, Washington will lower its reciprocal tariff on India from 25% to 18%, while New Delhi will abolish both tariff and non-tariff barriers on imports from the United States.

Prime Minister Modi also posted on X, thanking Trump for reducing tariffs on Indian exports to the US to 18%. Unlike the US president, however, Modi did not refer to a trade deal in his message. India’s ambassador to Washington, D.C., Vinay Mohan Kwatra, later confirmed on social media that an India–US trade agreement had indeed been announced.

Trump did not specify whether the US would also withdraw the additional 25% tariff imposed on Indian exports in August 2025, a measure introduced to pressure New Delhi to curb its purchases of Russian oil. A spokesperson for the US embassy in New Delhi subsequently clarified that the final tariff on Indian imports would stand at 18%.

The US administration has previously accused India of aiding Russian President Vladimir Putin’s war effort in Ukraine by continuing to import oil from Russia, alleging that New Delhi was circumventing sanctions imposed by the US and the European Union after Russia launched its invasion in February 2022.

Trump, however, has repeatedly claimed that he persuaded Modi to significantly reduce oil imports from Russia. He has also asserted that Washington and New Delhi had already agreed on a broader arrangement under which India would purchase energy, technology, coal, agricultural products, and other goods worth more than $500 billion from 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,” Trump wrote on Truth Social. He added that India’s decision to stop buying Russian oil “will help END THE WAR in Ukraine,” which he said was costing thousands of lives each week.

Modi responded by thanking Trump “on behalf of the 1.4 billion people of India” for the announcement, saying that cooperation between “two large economies and the world’s largest democracies” would benefit their citizens and unlock new opportunities for mutually beneficial growth. He also praised Trump’s leadership as vital for global peace, stability, and prosperity, and said India fully supported his efforts for peace.

The announcement comes against a backdrop of recent diplomatic strains. India had skipped a January 22 ceremony in Davos, Switzerland, marking the signing of the charter of Trump’s proposed ‘Board of Peace’, a global peace-making initiative initially focused on Gaza but intended to expand to other conflict zones.

Soon after Trump returned as the 47th president of the United States, Modi met him at the White House on February 13, where both leaders agreed to pursue a trade agreement. Relations later came under pressure due to Trump’s tariff threats against India, his close engagement with Pakistan’s civilian and military leadership, and his repeated claims of brokering a truce during the four-day India–Pakistan military flare-up in May 2025. Progress on the trade negotiations had remained elusive until Monday’s announcement.