Tariff Cuts and Trade Promises
President Donald Trump said Monday that he will lower tariffs on Indian goods from 25% to 18% after Indian Prime Minister Narendra Modi agreed to reduce purchases of Russian oil. Trump also claimed India would cut import taxes on U.S. products to zero and commit to buying $500 billion worth of American goods.
Trump framed the move as a step toward ending the war in Ukraine, saying on Truth Social that the agreement “will help END THE WAR in Ukraine… with thousands of people dying each and every week.” Modi responded positively on X, calling Trump’s leadership “vital for global peace, stability, and prosperity” and describing their recent phone call as “wonderful,” though he did not confirm any halt in Russian oil imports.
Oil and the Ukraine Conflict
India’s continued purchases of discounted Russian oil have long frustrated the U.S., which says these imports fund Moscow’s invasion of Ukraine. Trump has repeatedly suggested that targeting Russia’s oil revenue is key to ending the war. In 2024, nearly 36% of India’s crude imports—about 1.8 million barrels per day—came from Russia, even as European countries sharply reduced their purchases. Russian President Vladimir Putin recently affirmed that shipments to India would continue uninterrupted despite U.S. pressure.
Trump’s announcement comes ahead of another round of talks in Abu Dhabi between his special envoy Steve Witkoff, son-in-law Jared Kushner, and Russian and Ukrainian officials, aiming to explore a resolution to the conflict.
Tariff History and Global Trade Moves
Earlier in 2025, Trump imposed steep tariffs on Indian goods—first 25% over trade imbalances, then an additional 25% linked to India’s Russian oil purchases—bringing total duties to 50%. The new plan reduces tariffs to 18%, aligning India’s rate closer to the 15% applied to the EU and Japan.
The announcement comes just after India finalized a long-awaited free trade agreement with the European Union, covering nearly all goods and affecting around two billion people. India has also signed trade deals with Oman and completed talks with New Zealand, signaling a broader strategy to diversify trade and reduce dependence on the U.S. after years of tariff disputes.
While Trump touts the agreement as a win for American business and a step toward global stability, questions remain over how quickly India will follow through on cutting Russian oil purchases and the full impact of these trade commitments.
