US President Donald Trump on Monday said he agreed to a trade deal with India following a phone call with Indian Prime Minister Narendra Modi. 

"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.

Trump added that India had agreed to stop buying Russian oil, something which he has claimed in the past. 

He said India would also reduce its import taxes on US goods to zero and buy $500 billion worth of US energy, ‌technology and agricultural products.

The president did not provide further details of the oil purchases, other than saying India would buy "much more ‍from the United ​States and potentially Venezuela."

Modi welcomes tariff cut

The Indian government has not yet issued an official statement, but Modi confirmed the tariff reductions in a post on X. 

"When two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation," Modi said.

What tariffs has India faced?

India has faced two sets of tariffs from the US since Trump took office in January 2025.

In July, Trump announced a 25% tariff on goods from India claiming New Delhi had not done enough to narrow a steep trade surplus.

Trump has also sought to put pressure on New Delhi over its increased purchases of Russian oil since Moscow launched its war in Ukraine.

In addition to the so-called reciprocal tariffs of 25%, in August, Trump imposed an additional import tax of 25% on certain Indian products over the oil purchases, bringing the total to 50%, which was the highest among US trade partners.

On Monday, the White House said the additional 25% tariff on Indian imports would be dropped in response to India reducing Russian oil purchases.

"This will help END THE WAR in Ukraine, which is taking place right now, with thousands of people dying each and every week!" Trump added in his Truth Social post.

Modi's response on X did not mention any agreement on oil. 

Trump has long enjoyed a warm relationship with Modi, which has been complicated in the US president's second term by India's ties with Russia, and Trump's tariff policy.

The two last met in February in Washington, during which Trump said India would start buying more US petroleum products. However, those trade talks faltered as Trump began rolling out tariffs.

Trump's announcement comes days after the India reached alandmark free trade agreement with the European Union, enabling free trade on almost all goods between the EU's 27 members and India.

Edited by: Jenipher Camino Gonzalez