The United States and India have reached a trade agreement under which American reciprocal tariffs on Indian goods will be reduced from 25 per cent to 18 per cent, while India will eliminate all tariffs and non-tariff barriers on US products, US President Donald Trump announced on Monday (February 2).
Trump said the agreement was finalised after a phone conversation with Prime Minister Narendra Modi. In a post on his social media platform Truth Social, Trump stated that the two leaders had “Agreed to a trade deal” aimed at expanding bilateral trade and strengthening economic ties between the two countries.
About an hour before Trump’s post, US Ambassador to India Sergio Gor said on X that the two leaders had spoken by phone and urged followers to “stay tuned.” After Trump’s announcement, Gor welcomed the development, saying he was “Thrilled by the news of the trade deal” and describing India-US relations as having “limitless potential.”
Nearly 40 minutes after Trump’s post, Prime Minister Modi responded on X, thanking Trump “on behalf of the 1.4 billion people of India” for the reduced tariff announcement. However, Modi did not confirm that a trade deal had been finalised. He also did not mention Trump’s claims regarding India ending Russian oil purchases or a commitment to buy USD 500 billion worth of American products.
Trump’s post suggested that India had agreed to remove all tariffs and non-tariff trade barriers on US goods, a move that would represent one of the most significant market opening steps taken by New Delhi in recent years. He also claimed that India would sharply increase purchases of American products, though no timeline or official breakdown of the figures was provided.
No formal joint statement was issued by the White House or India’s Ministry of Commerce immediately after the announcement. Indian officials have so far refrained from confirming the full scope of Trump’s claims, raising questions about whether the agreement is a completed deal or a political understanding awaiting formal documentation.
The announcement comes amid ongoing efforts by Washington to rebalance trade relationships through reciprocal tariffs, while India has been seeking improved access for its exports to the US market, particularly in pharmaceuticals, engineering goods and textiles.
Analysts say that if fully implemented, the agreement could significantly reshape bilateral trade flows and deepen strategic ties between the two countries. However, they caution that the absence of official confirmation from India on key elements of the deal suggests that negotiations may still be continuing at the technical level.
Further details are expected in the coming days as both governments clarify the scope and legal status of the agreement.
