India, U.S. near trade deal with major tariff cuts, reduced Russian oil purchases

The United States could significantly reduce tariffs on Indian exports as the two countries approach a trade deal that could require New Delhi to cut oil purchases from Russia, an Indian media outlet said. mint reported Wednesday.

Washington as part of trade deal can reduce tariffs Mint reported that India’s exports have increased to 15-16% from the current 50%.

India is considering increasing its import quota of non-genetically modified maize from the US (currently 0.5 million tonnes annually) even with a 15% import duty, the report said, and is pushing for a mechanism through which both sides can reconsider tariffs and market access over time.

US President Donald Trump on Tuesday said he had received assurances from Indian Prime Minister Narendra Modi in a phone call that New Delhi would reduce its purchases of Russian oil.

“He won’t buy much oil from Russia. He wants the war to end as much as I do. He wants the war with Russia and Ukraine to end, and as you know, they won’t buy much oil.” Trump told reporters abroad on Air Force OneHe threatened that New Delhi would continue to pay “enormous” tariffs if it did not do so.

In a post published at X local time on Wednesday morning, Modi confirmed the phone call with Trump and added that he hoped the two countries would continue to “stand together against all forms of terrorism”, without mentioning India’s stance on Russian oil.

Trump also said last week that Modi agreed to cut oil purchases from Russia in a phone call. An Indian foreign ministry spokesman said the following day: I am not aware of any meeting between Trump and Modi.

On the question of cutting oil imports from Russia, the spokesperson said on Thursday: “India is a major importer of oil and gas. Protecting the interests of the Indian consumer in a volatile energy scenario has been our consistent priority. Our import policies are fully guided by this objective.”

US-India relations further deteriorated when Modi met with Russian President Vladimir Putin and Chinese President Xi Jinping in Beijing last month; this was seen as a sign of Trump’s desire to strengthen rather than cut India’s ties with Moscow.

India has become the world’s largest buyer of Russian crude oil after China since the start of the war in Ukraine in 2022. The 1.6 million barrels per day in the first half of this year is up from 50,000 barrels per day in 2020, according to the U.S. Energy Information Administration.

In recent weeks, Trump has toned down his rhetoric, expressing optimism about ongoing negotiations and reiterating on Tuesday that Modi is a leader. “great buddy.”

Finalization of trade deal likely to be conveyed to Trump and Modi at the ASEAN summit Neither Trump nor Modi officially confirmed their attendance at the event later this month, Mint reported.

“The broad outlines of the agreement are available, but sensitive areas such as agriculture and energy need political approval before the agreement can be announced,” the report said.

India’s Department of Commerce and Industry, the U.S. Department of Commerce and the U.S. Trade Representative did not immediately respond to CNBC’s requests for comment.

Data from the government-backed India Brand Equity Foundation shows bilateral trade between New Delhi and Washington reached a record $132.2 billion in the fiscal year ending March 2025, up more than 10% from the previous year.

While India’s exports to the USA increased by 11.6% to 86.51 billion dollars, its imports from the country increased by 8% to 45.69 billion dollars.