Trump plans to lower tariffs on Indian goods to 18% after India agreed to stop buying Russian oil

President Donald Trump walks on the South Lawn upon his arrival to the White House, Sunday, Feb. 1, 2026, in Washington. (AP Photo/Jose Luis Magana)

WASHINGTON -- U.S. President Donald Trump said Monday that he plans to lower tariffs on goods from India to 18 per cent, from 25 per cent, after Indian Prime Minister Narendra Modi agreed to stop buying Russian oil.

The move comes after months of 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 U.S. goods to zero and buy $500 billion worth of American products.

“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 posted on X that he was “delighted” by the announced tariff reduction and that Trump’s “leadership is vital for global peace, stability, and prosperity.”

“I look forward to working closely with him to take our partnership to unprecedented heights,” Modi said.

Trump has long had a warm relationship with Modi, only to find it complicated recently by Russia’s war in Ukraine and trade disputes.

Trump has struggled to make good on a campaign pledge to quickly end the Russia-Ukraine war and has been reluctant since his return to office to place pressure on Russian President Vladimir Putin. He has simultaneously imposed tariffs without going through Congress to achieve his economic and foreign policy aims.

The announcement of the agreement with India comes as his special envoy, Steve Witkoff, and son-in-law Jared Kushner are expected to hold another round of three-way talks with Russian and Ukrainian officials in Abu Dhabi later this week aimed at finding an endgame to the war, according to a White House official who requested anonymity to describe the upcoming meeting.

Trump has voiced that he believes that targeting Russia’s oil revenue is the best way to get Moscow to end its nearly four-year war against Ukraine, a view that dovetails with his devotion to tariffs.

In June, Trump announced the United States would impose a 25 per cent tariff on goods from India after his administration felt the country had done too little to narrow its trade surplus with the U.S. and open up its markets to American goods. In August, Trump imposed additional import taxes of 25 per cent on Indian products because of its purchases of Russian oil, putting the combined rate increase at 50 per cent.

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.

The announced tariff reduction comes days after India and the European Union reached a free trade agreement that could affect as many as 2 billion people after nearly two decades of negotiations. That deal would enable free trade on almost all goods between the EU’s 27 members and India, covering everything from textiles to medicines, and bringing down high import taxes for European wine and cars.

The deal between two of the world’s biggest markets came as Washington targets both the Asian powerhouse and the EU bloc with steep import tariffs, disrupting established trade flows and pushing major economies to seek alternate partnerships.

In recent months, India has accelerated a push to finalize several trade agreements. It signed a deal with Oman in December and concluded talks for a deal with New Zealand.

Trump seemed to hint at a positive call with Modi on Monday morning, posting to social media a picture of the two of them on a magazine cover.

When the pair met last February, the U.S. president said that India would start buying American oil and natural gas. But the talks faltered and the tariffs imposed last year by Trump did little to initially change India’s objections.

While the U.S. has been seeking greater market access and zero tariff on almost all its exports, India has expressed reservations on throwing open sectors such as agriculture and dairy, which employ a bulk of the country’s population for livelihood, Indian officials said.

The Census Bureau reported that the U.S. ran a US$53.5 billion trade imbalance in goods with India during the first 11 months of last year, meaning it imported more than it exported.

At a population exceeding 1.4 billion people, India is the world’s most populous country and viewed by many government officials and business leaders as geopolitical and economic counterbalance to China.

By Josh Boak, Aamer Madhani And Rajesh Roy.

Roy reported from New Delhi, India.