Washington has agreed to lift a 25% tariff linked to India’s purchases of Russian crude oil, following New Delhi’s commitment to halt those imports. The White House announced this development on Monday, marking a significant shift in US-India trade relations amid ongoing global energy tensions.
The decision stems from a recent phone conversation between President Donald Trump and Prime Minister Narendra Modi, where both leaders finalized a trade agreement. A senior White House official confirmed to reporters that the tariff removal is directly tied to India’s pledge to end Russian oil imports and ramp up purchases from the US and potentially Venezuela.
President Trump highlighted the deal on Truth Social, stating that the US will immediately reduce reciprocal tariffs on Indian goods from 25% to 18%. He described it as a major step forward in bilateral trade, energy cooperation, and broader geopolitical objectives, including efforts to end the Russia-Ukraine war.
Prime Minister Modi echoed the sentiment on X, expressing delight over the reduced 18% tariff on ‘Made in India’ products. He emphasized how collaboration between two major economies and the world’s largest democracies creates mutual benefits and new opportunities for partnership.
This move aligns US trade policy with energy and geopolitical goals, particularly Washington’s campaign to curb Russia’s oil revenues since the Ukraine invasion. While the US has urged allies to cut Russian energy buys, India had increased discounted Russian crude imports to meet domestic needs, citing national interests and market conditions.
India has consistently advocated for dialogue and diplomacy to resolve the conflict, maintaining balanced ties with both Russia and the West. As trade and investment talks between the two nations near completion, energy cooperation remains a cornerstone of their strengthening alliance.
The US has emerged as a reliable long-term supplier of oil and gas to India in recent years. Industry watchers, refiners, and exporters are closely monitoring the tariff cut’s impact on global energy markets and Indian policy.
In related news, India’s Foreign Minister S. Jaishankar is set to visit Washington this week for the ‘Critical Minerals Ministerial’ hosted by US Secretary of State Marco Rubio. Discussions will focus on supply chain resilience, clean energy transition, and strategic cooperation in critical minerals.