US-India Trade Deal, Tariff Reduction
Analysis based on 6 articles · First reported Feb 03, 2026 · Last updated Feb 03, 2026
The trade deal is expected to positively impact the markets of both India and the United States. India's 'Made in India' products will benefit from reduced tariffs in the United States, while the United States will see increased exports to India, particularly in energy, technology, and agriculture sectors.
The United States and India have agreed to a new trade deal. The United States will reduce tariffs on Indian goods from 25% to 18%, a move welcomed by India's Finance Minister Nirmala Sitharaman and Prime Minister Narendra Modi. In return, India has committed to reducing its tariffs and non-tariff barriers against the United States to zero and significantly increasing purchases of American goods, including energy, technology, and agriculture, potentially exceeding $500 billion. A key condition of the deal, as stated by United States President Donald Trump and confirmed by a White House official, is that India must cease, not just reduce, its purchases of Russian oil. This condition is also linked to efforts to end the war in Ukraine. The agreement is seen as a major step forward in India-United States trade relations, fostering economic cooperation and a long-term strategic partnership.
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