In return, the Indian Prime Minister Narendra Modi has agreed that his country will stop buying Russian oil and make a $500 billion investment in various American industries and products.
CNN reported that the 18 percent tariff fell from 50 percent, which included a 25 percent reciprocal tariff that Trump imposed in August to encourage India to stop buying Russian oil.
“It was an honor to speak with Prime Minister Modi of India this morning,” Trump wrote on Truth Social on Monday. “He is one of my greatest friends and a powerful and respected leader of his country. We talked about many things, including trade and ending the war with Russia and Ukraine. He agreed to stop buying Russian oil, and to buy much more from the United States and possibly from Venezuela.”
The president argued that taking oil revenues away from Moscow will help put an end to oil revenues War between Russia and Ukraine earlier.
Trump continued: “Out of friendship and respect for Prime Minister Modi and, at his request, effective immediately, we have agreed to a trade agreement between the United States and India under which the United States will charge a reduced reciprocal tariff, reducing it from 25% to 18%.”
“They will also take steps to reduce their tariffs and non-tariff barriers against the United States to ZERO. The Prime Minister has also committed to ‘BUY AMERICAN’ at a much higher level, in addition to over $500 BILLION DOLLARS in American energy, technology, agriculture, coal and many other products,” the president wrote.
Donald J. Trump Truth Social Post 11:58 AM EST 02.02.26 pic.twitter.com/HKTag9ZujW
– Commentary Donald J. Trump Posts from Truth Social (@TrumpDailyPosts) February 2, 2026
Reacting to Trump’s decision, Modi said: “Great to speak with my dear friend President Trump today. I am happy that Made in India products now attract a reduced tariff of 18%. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement.”
“When two major economies and the world’s largest democracies work together, it benefits our people and unlocks enormous opportunities for mutually beneficial cooperation,” the Prime Minister added.
“President Trump’s leadership is vital for global peace, stability and prosperity. India fully supports his efforts for peace,” Modi said.
Great to speak with my dear friend President Trump today. I am happy that Made in India products now have a reduced rate of 18%. Thank you to President Trump on behalf of India’s 1.4 billion people for this wonderful announcement.
When two major economies and the…
— Narendra Modi (@narendramodi) February 2, 2026
CNN reported that India is the second largest buyer of Russian oil after China, with Turkey in a distant third.
In December 2025, China bought 47 percent of Russia’s oil exports, compared to India’s 38 percent. Turkey and the European Union each bought 6 percent, the newspaper said Center for Energy and Clean Air Research.
There is a trade imbalance between the US and India: the US imported $95.5 billion worth of goods from India in November 2025 and exported $42 billion to India. Census Bureau.
CNN noted: “Among the top goods the US imported from India last year were computers and other electronics, such as phones, pharmaceuticals, clothing and chemicals. Jewelry prices in the United States have risen in recent months in part due to tariffs on India. Meanwhile, India’s top imports from the US have been oil, gas, aircraft and aircraft parts.”
Amy Hariani, an international trade lawyer and consultant on US-India commercial relations, said in an email to Politics on the deal: “The tariff reduction from 25% to 18% matters, but the bigger story is that two great democracies worked through real differences and opted for economic alignment in a complex geopolitical environment.”
She added: “Credit goes to President Trump and Prime Minister Modi for providing political leadership, and to officials like [U.S. Trade Representative] Jamieson Greer and their teams who continue to do this tirelessly.”
This article originally appeared on The Western Journal.
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