Trump says U.S. and India reached trade deal, will lower tariffs immediately
President Donald Trump announced that the United States and India have reached a trade agreement and will immediately seek to reduce tariffs on each other’s goods.
Trump said Prime Minister Narendra Modi also agreed to buy American products “at a much higher level” as part of the deal. Real Social post Following a meeting with the Indian leader on Monday.
In his post, Trump said Modi also committed to “stop buying Russian Oil and buy much more from the United States and potentially Venezuela.”
Read Trump’s full announcement:
It was an honor to speak with Prime Minister Modi of India this morning. He is one of my greatest friends and a Strong and Respected Leader of his Country. We talked about many topics, from trade to ending the war with Russia and Ukraine. He agreed to stop buying Russian Oil and buy much more from the US and potentially Venezuela. This will help END THE WAR in Ukraine where thousands of people are currently dying every week! Out of friendship and respect for Prime Minister Modi and at his request, we have agreed to a Trade Agreement between the United States and India, effective immediately, under which the United States will impose a reduced Reciprocal Tariff, reducing the Reciprocal Tariff from 25% to 18%. Likewise, they will move forward to reduce their Tariffs and Non-Tariff Barriers against the USA to ZERO. The Prime Minister also pledged $500 BILLION in US Energy, Technology, Agriculture, Coal and many other products, as well as a much higher level of “BUY AMERICAN”. Our wonderful relationship with India will be even stronger in the future. PM Modi and I are two people who GET THEIR JOB DONE, something that cannot be said for most. Thank you for your interest in this topic!
Trump’s announcement claims that the agreement will come into force without delay, but the text of the agreement has not yet been implemented and it is not clear whether anything has been signed. The White House and the U.S. Trade Representative’s office did not immediately respond to CNBC’s requests for additional information.
legal experts and some Democratic lawmakers They questioned whether Trump could sign any binding trade agreements without congressional approval, as he has done repeatedly since taking office again. Trump and his supporters argue that Congress has delegated to the executive branch the authority to secure such deals.
Lori Mullins, chief operating officer of Rogers & Brown Custom Brokers, told CNBC that her industry has learned not to react prematurely to Trump’s public trading statements.
“Once the Federal Register notice is published with dates, times and applicable rate codes, it becomes official,” Mullins said.
Trade talks between the Trump and Modi administrations stalled last year over a series of disagreements, including New Delhi’s continued dependence on Russian oil.
In August, Trump imposed a 25% tariff on India in response to these oil purchases; This is in addition to a 25% “reciprocal” tax on the country’s goods bound for the US, which went into effect earlier that month.
In his post on Monday, Trump said the reciprocal tariff rate on India would be reduced to 18% “effective immediately.”
Trump wrote that India “will likewise move forward to reduce Tariffs and Non-Tariff Barriers against the United States to ZERO.”
Modi confirms cut in US tariffs in an X post later Monday.
“I am pleased that Made in India products now have a reduced tariff of 18%. Big thanks to President Trump on behalf of 1.4 billion people in India for this great announcement,” 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. President Trump’s leadership is vital to global peace, stability and prosperity. India fully supports his peace efforts. I look forward to working closely with him to take our partnership to unprecedented heights,” the Prime Minister said.
Trump’s announcement came a week after India closed a major free trade agreement with the European Union, which Modi described as the “mother of all deals”.
Some analysts predicted that progress between Europe and India could “light a fire” in New Delhi and Washington’s search for a bilateral agreement.
— CNBC’s Lori Ann LaRocco contributed to this report.
