18% U.S. tariff on ‘Made in India’ products, says PM Modi after phone call with President Trump

Signaling a positive turn in bilateral relations, which have been tense due to many problems, Prime Minister Narendra Modi announced that “customs duties” on “Made in India” products in the USA will “now be reduced by 18%” after his phone call with President Donald Trump on Monday.

The move is expected to significantly reduce the impact of the 50% penalty tariffs that Mr Trump imposed on India in August 2025.

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“I am pleased that Made in India products now have an 18% discounted tariff,” Mr. Modi said, thanking Mr. Trump. In his post on X, Mr Modi said: “When two major economies and the world’s largest democracies work together, it benefits our people and unlocks tremendous opportunities for mutually beneficial cooperation.”

Moments ago, Mr. Trump announced on the social media platform Truth Social that the United States and India had “agreed” on a trade deal.

“…We have agreed to a Trade Agreement between the United States and India under which the United States will impose a reduced Tariff, reducing the Reciprocal Tariff from 25% to 18%,” Mr. Trump said. He further claimed, “…they will likewise move forward to reduce Tariffs and Non-Tariff Barriers against the United States to ZERO.”

Commerce and Industry Minister Piyush Goyal welcomed the developments.

The State Department has not yet responded to some questions about the statement and the details Mr. Trump shared. In his post on Truth Social, the US President had said that during the meeting, India agreed to “stop buying Russian oil”. He also claimed that India would “buy much more from the US and potentially Venezuela”. Mr Trump said Mr Modi had “committed” to increasing purchases of US products to $500 billion.

The two announcements by Mr Modi and Mr Trump drew an immediate response from the Congress party, with the party’s general secretary (communications) Jairam Ramesh saying: “It looks like Mr Modi has finally capitulated.”

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The phone conversation between Mr Modi and Mr Trump took place as External Affairs Minister S. Jaishankar begins his visit to the US from February 2 to 4, where he will attend the Critical Minerals Ministerial meeting invited by US Secretary of State Marco Rubio.

MEA announced that Mr. Jaishankar “will also hold meetings with senior members of the US administration” during the ongoing tour, adding, “The ministerial meeting will focus on supply chain resilience, clean energy transitions and strategic cooperation in critical minerals.” In addition to India, dozens of countries with important national mineral production such as Kenya, South Korea and the Democratic Republic of Congo will also attend the meeting. The ministry meeting aims to reduce dependence on China in critical minerals and create a supply chain that will cover the entire supply chain, from mining to processing, recycling and pricing mechanism. Participating countries are also expected to sign a non-binding document.