India and the US Near a Close Trade Deal to Slash Tariffs

On Wednesday, October 22, 2025, The Mint newspaper reported that India and the US are about to close a long-awaited trade deal that could cut down US-imposed tariffs on India to about 15% from 50%.

For several months now, India and the US have been in ongoing discussions on this matter, aiming to ease access for Indian exports to the US and open India’s agricultural products to the global market.

It’s worth remembering that President Trump hiked tariffs on India in August over New Delhi’s purchase of Russian oil. Trump accused India of indirectly aiding the war in Ukraine by purchasing oil from Russia.

A successful deal may see India reduce its purchase of Russian oil and allow imports of non-genetically modified (GM) corn and soymeal from the US into its markets.

The deal is expected to be revealed at the upcoming Association of Southeast Asian Nations (ASEAN) Leaders Summit in Kuala Lumpur from October 26 to 28, where President Trump will meet directly with Indian Prime Minister Narendra Modi.

India May Cut Russian Oil Imports as Part of the US Trade Agreement

According to the report, the trade deal will potentially include a periodic tariff on imports and review market access conditions. This will enable both countries to adapt appropriately to changing trade conditions.

The report noted that the slash would help balance the competitiveness of Indian goods, especially in pharmaceuticals, textiles, and the manufacturing industry.

More so, as part of the agreement, India may have to gradually reduce its import of Russian crude oil as soon as possible. President Trump confirmed this by stating that he had spoken with Modi and was assured that India would no longer purchase significant quantities of oil from Russia. While this action definitely carries some geopolitical implications, India has not confirmed the statement publicly yet.

However, the MINT newspaper revealed that Reliance Industries Limited, India’s largest oil refiner, had already shifted a substantial part of its intake towards the Middle East.

Since the Russia-Ukraine war began in 2022, India has been one of the largest buyers of Russia’s discounted crude oil. Oil imports from Russia accounted for roughly one-third of India’s total crude oil imports.

Shifting imports from Russia would reflect a strategic change in New Delhi’s energy sourcing and may align the country more closely with US geopolitical interests.

On Tuesday,  President Trump reiterated that India will cut down on Russian oil purchases. He mentioned that he had received assurance from Indian Prime Minister Narendra Modi in a phone call that New Delhi would scale back purchases of Russian oil.

According to Trump,

“He’s not going to buy much oil from Russia. He wants to see that war end as much as I do. He wants to see the war end with Russia, Ukraine, and, as you know, they’re not going to be buying too much oil.”

Trump threatened that New Delhi would keep paying high tariffs if it did not do so.

Meanwhile, Washington continues to pursue access to India’s agricultural and technology exports while New Delhi pushes for lower tariffs on steel, textile, and manufactured goods exports.

PM Modi has thanked Trump via an X post for the call together and gave warm Diwali greetings. He emphasized the continued friendship between the two countries.

https://x.com/narendramodi/status/1980826742379184347