WP: Trump to lift extra tariffs on India following Russian oil pullout

On February 2, President Donald Trump announced that the U.S. and India finalised a trade deal, cutting Washington’s tariff on Indian goods to 18 per cent and India’s tariffs on U.S. goods to “zero,” The Washington Post reports.

A White House official, speaking on the condition of anonymity to discuss sensitive matters, said the administration will also drop the additional 25 per cent tariff imposed by Trump in August to penalise India for its purchases of Russian oil.

Indian Prime Minister Narendra Modi “agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela,” Trump wrote. “Our amazing relationship with India will be even stronger going forward.”

In a post shortly afterwards on X, Modi thanked Trump “for this wonderful announcement” and said that “when two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities.” He appeared to confirm the new 18 per cent rate on Indian products but did not mention Russian oil or Trump’s claim that India would eliminate its tariffs on American goods.

The White House and India’s Ministry of External Affairs did not immediately respond to questions from The Washington Post. The agreement was reached just days after India signed a sweeping trade deal with the European Union, part of the country’s efforts to diversify its global partnerships amid tensions with Washington.

Relations between the two countries were expected to reach new heights during Trump’s second term, but soured rapidly after India’s conflict with Pakistan in May and the president’s decision to single out India for becoming a leading global customer of Russian oil.

India is the world’s fourth-largest economy and one of America’s top trading partners — the U.S. imported $87.3 billion worth of Indian goods in 2024, according to data from the Office of the U.S. Trade Representative. The 50 per cent U.S. tariff that went into effect in August was among the highest levied by Trump on any country; the new 18 per cent figure is slightly more favourable than the rates imposed on India’s archrival Pakistan (19 per cent), as well as Vietnam and Bangladesh (20 per cent), regional competitors in manufacturing.

While key details about the deal remain unclear, it represents a “much-needed boost” for Washington and New Delhi, said Michael Kugelman, a senior fellow for South Asia at the Atlantic Council.

“Happy days may not yet be here again for the relationship,” he said. “But this is still its most promising development after nearly a year of strain.”

The announcement comes almost a year to the day after Modi met with Trump in the Oval Office, where the leaders pledged to increase trade to $500 billion by 2030.

“In the language of America, it’s ‘Make India Great Again’ — MIGA,” Modi said at the White House in February 2025. “When America and India work together, this MAGA plus MIGA becomes a ‘mega partnership for prosperity.’”

Behind the bonhomie, however, there were already signs of tension. For years, Trump had called India a “big abuser” of tariffs. Indian officials had long been reluctant to make trade concessions in the agriculture, dairy and seafood sectors, which, taken together, employ a majority of the country’s workforce.

India’s military confrontation with Pakistan in May introduced another irritant. Trump repeatedly claimed that he helped solve the crisis, annoying Indian officials who denied a White House role. Pakistan, meanwhile, thanked the president for helping and nominated him for the Nobel Peace Prize.

When Trump announced he was targeting India with an additional tariff for buying Russian oil, his top advisers went on the offensive. Peter Navarro said that Russia’s conflict with Ukraine was “Modi’s war” and that New Delhi had become a “laundromat for the Kremlin.” U.S. Treasury Secretary Scott Bessent said “some of the richest families in India” were profiting from the conflict in Europe.

A Washington Post investigation found that Reliance Industries, the conglomerate owned by India’s richest man and Modi ally Mukesh Ambani, had bought roughly $33 billion in Russian oil since the full-scale invasion of Ukraine, accounting for roughly 8 per cent of Moscow’s crude oil sales during that period. Trump told his negotiators that India would have to scale back its purchases before a trade agreement could be finalised, The Post reported in September.

Under growing pressure from the White House, New Delhi has tried to wean itself off Russian crude in recent months. The country imported 1.2 million barrels per day in December, according to data from the Center for Research on Energy and Clean Air. The figure had fallen below 600,000 barrels per day as of January 15, the data showed.

By Aghakazim Guliyev