Trump announces 'trade deal' with India; Modi hails US ‍President's move

US President Donald Trump announced a "trade deal" with India on Monday after speaking to Prime Minister Narendra Modi, saying New Delhi agreed to stop buying Russian oil and may purchase it instead from Venezuela.

"Out of friendship and respect for Prime Minister Modi and, as per his request, ‌effective immediately, we agreed to ‍a Trade Deal between the United States and India, whereby ​the United States will charge a reduced Reciprocal Tariff, lowering it ​from 25% ‍to 18%," Trump said ‌in a social media post following a call with Indian Prime Minister Narendra ​Modi.

"This will help END THE WAR in Ukraine, which is taking place right now, with thousands of people dying each and every week!” Trump said in a Truth social post announcing the tariff reduction on India.

Modi also ‌committed to buy more than $500 billion dollars worth of US energy, technology, agricultural and other products, ‌Trump added.

Modi said it was "wonderful to speak with my dear friend," and thanked Trump ⁠for a ‍trade deal between the two ‍nations.

"Delighted that ‍Made in India products will ​now have a reduced tariff of 18%," ​Modi ‍said in ‌a post on X, adding ​that he looked ‌forward to working closely with the US President.

"Big thanks to President Trump on behalf of the 1.4b people of India for this wonderful announcement. When two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation. President Trump’s leadership is vital for global peace, stability, and prosperity. India fully supports his efforts for peace. I look forward to working closely with him to take our partnership to unprecedented heights."

The move comes after months after Trump pressing India to cut its reliance on cheap Russian crude. India has taken advantage of slacked Russian oil prices as much of the world has sought to isolate Moscow for its February 2022 invasion of Ukraine.

Trump said that India would also start to reduce its import taxes on US goods to zero and buy $500 billion worth of American products.

Historically, India’s relationship with Russia revolves more around defense than energy. Russia provides only a small fraction of India’s oil but the majority of its military hardware.

But India, in the aftermath of the Russian invasion, used the moment to buy discounted Russian oil, allowing it to increase its energy supplies while Russia looked to cut deals to boost its beleaguered economy and keep paying for its brutal war.

Trump has long had a warm relationship with Modi. But in June, he announced the United States would impose a 25% tariff on goods from India, plus an additional import tax because of India’s purchasing of Russian oil.

Agencies