India and the United States have reached a trade deal that signals a thaw in relations after months of sharp rhetoric. The agreement was finalised after a late-night conversation between Prime Minister Narendra Modi and President Donald Trump, resulting in a cut in US tariffs from 25% to 18%.
“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%. They will likewise move forward to reduce their Tariffs and Non Tariff Barriers against the United States, to ZERO,” Trump posted on Truth Social.
“He agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela…The Prime Minister also committed to “BUY AMERICAN,” at a much higher level, in addition to over $500 BILLION DOLLARS of U.S. Energy, Technology, Agricultural, Coal, and many other products,” he added.
Responding to the breakthrough, PM Modi posted on X, “Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement.”
Defence Minister Rajnath Singh said, “A landmark moment for India-US relations as a historic trade deal has been finalised, bringing tariffs down to a significantly lower 18% and opening a new chapter of deeper and greater economic cooperation.”
India's Foreign Minister S Jaishankar lauded the trade deal and said, “Welcome the announcements on bilateral trade following the conversation between PM Modi and President Trump.
“This will create more jobs, spur growth and promote innovation in both economies. It will strengthen ‘Make in India' endeavours and encourage trusted technology ties. The opportunities in our economic engagement are truly vast and we are confident of realising them.”
Home Minister Amit Shah said, “A big day for India-US relations as the trade deal has been locked with a significantly reduced tariff of 18%, paving the way for stronger trade ties and mutual growth.
Union Minister of Commerce & Industry Piyush Goyal posted, “This agreement unlocks unprecedented opportunities for farmers, MSMEs, entrepreneurs, and skilled workers to Make in India for the world, Design in India for the world, and Innovate in India for the world. It will help India get technology from the US.”
Railways Minister Ashwini Vaishnaw said, “Trade deal between US and India will lead to brighter future for both countries. India-US Trade deal is a win-win deal. Citizens and industries of both countries will benefit greatly from this deal.”
Nitin Nabin, National President of the Bharatiya Janata Party (BJP), said, “The United States and India are the world's largest democracies. Today's developments in India–US cooperation mark a major leap for our economic future.”
With the latest agreement in place, India has concluded five trade pacts over the past year, including deals with the UK, the European Union, Oman and New Zealand. New Delhi, however, did not refer to the US President's remarks regarding the Prime Minister's assurances on Russian oil imports or increased purchases of American goods.
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