India says it's going to stop buying Russian oil and lower trade barriers after U.S. President Donald Trump announced a trade deal with India on Monday (2 February) that cuts American tariffs on Indian goods to 18% from 50%.
Trump announced the deal on social media following a call with Indian Prime Minister Narendra Modi, noting that India would now buy oil from the U.S. and potentially Venezuela.
A White House official told Reuters that the U.S. was rescinding a punitive 25% duty on all imports from India over its purchases of Russian oil that had stacked on top of a 25% "reciprocal" tariff rate.
Trump's announcement added to positive sentiment over semiconductor makers and artificial intelligence (AI), lifting major indexes into positive territory on the day.
Modi also committed India to "BUY AMERICAN at a much higher level," in addition to buying more than $500 billion worth of U.S. energy, including coal, along with technology, agricultural and other products, Trump added.
"They will likewise move forward to reduce their Tariffs and Non Tariff Barriers against the United States, to ZERO," Trump said of India.
The deal brings India "broadly in line with its Asian peers on tariff rates" of 15% to 19%, said Madhavi Arora, economist at Emkay Global, adding that it would eliminate a disproportionate drag on India's exports and its rupee currency.
India and the United States are expected to issue a joint statement on their trade deal in the near term, once a “final understanding” is reached and technical procedures are completed, Indian Trade Minister Piyush Goyal said on Tuesday.
Separately, an Indian trade ministry source said India plans to offer zero tariffs to the United States mostly on industrial goods.
Indian markets had been battered since the tariffs were levied by Washington, making it the worst-performing market among emerging nations in 2025, with record outflows of foreign investors.
The U.S. Chamber of Commerce, which has long advocated a market-opening trade deal with India, called Trump's announcement progress towards that goal.
"We are optimistic that this is the first step toward a comprehensive trade agreement that will unlock even more private sector collaboration, and we look forward to reviewing the details of the deal," Chamber CEO Suzanne Clark said in a statement.
"Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%," Modi said in a social media post on X.
"Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement."
India's Trade Minister Piyush Goyal said the deal would draw the U.S. and Indian economies closer together.
"This agreement unlocks unprecedented opportunities for farmers, MSMEs, entrepreneurs, and skilled workers to Make in India for the world," Goyal said in a post on X.
The deal comes less than a week after India signed a long-awaited trade deal with the European Union that is expected to eliminate or reduce tariffs on 96.6% of traded goods by value. That deal excludes EU soybeans, beef, sugar, rice and dairy from tariff reductions.
On Saturday (31 January), Trump teased a potential deal for India to buy Venezuelan oil after the U.S. seized Venezuelan President Nicolas Maduro in a military raid in early January.
The deal followed months of tense trade negotiations between the world's two largest democracies.
Last August, Trump doubled duties on imports from India to 50% to pressure New Delhi to stop buying Russian oil, and earlier this month said the rate could rise again if it did not curb its purchases.
Purchases of Venezuelan oil would help replace some of the Russian oil bought by India, the world's third-biggest oil importer.
India relies heavily on oil imports, covering around 90% of its needs, and importing cheaper Russian oil has helped lower its import costs since Moscow invaded Ukraine in 2022 and Western nations enacted sanctions on its energy exports.
Saudi civil defence sent an all-clear on Saturday after issuing alerts for a second time for potential danger in R...
The U.S. State Department approved a $2.7 billion military sale to Ukraine for air-defence development upgr...
Chinese researchers have developed the world’s smallest CT scanner, a portable device designed to produce...
Iran's Revolutionary Guards Navy said a Togo-flagged oil tanker was struck while attempting to make an “illegal passage” through the Strait of Hormuz, Iranian state media said early on Friday.
The European Union will disburse €3.3 billion ($3.8 billion) to Ukraine for missiles and drones, European Commission President Ursula von der Leyen said after a phone call with Ukrainian President Volodymyr Zelenskyy.
Saudi civil defence sent an all-clear on Saturday after issuing alerts for a second time for potential danger in Riyadh and the city of Al-Kharj east of the capital, amid an uptick in attacks by Iran-aligned Houthis on the Gulf country.
The U.S. State Department approved a $2.7 billion military sale to Ukraine for air-defence development upgrades, along with related equipment and services, the department said. Meanwhile, Ukrainian authorities reported at least 10 people had died in Russian attacks over the last 24 hours.
Here's your AnewZ Daily Brief for 18 September 2026. These are the top five stories making headlines in the field of science.
The U.S. State Department approved a $2.7 billion military sale to Ukraine for air-defence development upgrades, along with related equipment and services, the department said. Meanwhile, Ukrainian authorities reported at least 10 people had died in Russian attacks over the last 24 hours.
Cuba's electrical grid suffered a total collapse on Friday, plunging the nation into darkness and leaving millions without power amid a U.S. pressure campaign that has largely blocked oil from reaching the Caribbean's largest island.
A China Coast Guard vessel rammed a Philippine boat on a refueling mission in the South China Sea, the Philippine Coast Guard (PCG) said, in the latest confrontation between the two countries in disputed waters.
U.S. President Donald Trump said on Friday that additional news organisations could be barred from the White House, hours after announcing bans on CNN, MS NOW and Politico over coverage he described as “fake news”.
U.S. President Donald Trump announced an agreement with Denmark and Greenland on Friday that would significantly expand Washington’s military presence on the Arctic island and give the United States what he described as permanent authority over its security.
You can download the AnewZ application from Play Store and the App Store.
What is your opinion on this topic?
Leave the first comment