Prime Minister Narendra Modi on Monday confirmed that India and the United States have finalised a long-awaited trade deal, bringing major relief for Indian exporters. Under the agreement, US tariffs on Made in India products have been reduced to 18%.

Sharing the update on X, PM Modi thanked US President Donald Trump and praised his leadership.

“Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement,” the Prime Minister wrote.

He added that cooperation between the two nations brings wide-ranging benefits.

“When two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation,” PM Modi said.

In another post, PM Modi highlighted President Trump’s global role and said India supports his peace efforts.

“President Trump’s leadership is vital for global peace, stability, and prosperity. India fully supports his efforts for peace. I look forward to working closely with him to take our partnership to unprecedented heights,” the Prime Minister added.

The deal brings an end to months of trade tension between the two countries. Late last year, President Trump imposed a 25% tariff on Indian exports after trade negotiations missed a deadline.

Later, the US doubled the tariffs to 50%, accusing India of continuing to buy oil from Russia during the Ukraine war.

With the new agreement, tariffs have now been sharply reduced to 18%, easing pressure on Indian businesses.

The tariff cut places India in a stronger position compared to other exporting nations. After the announcement, US tariffs stand at:

  • India: 18%

  • Indonesia: 19%

  • Vietnam: 20%

  • Bangladesh: 20%

  • China: 34%

The move is seen as a major boost for Indian trade and manufacturing, especially after long and difficult negotiations.

US Ambassador calls India-US ties ‘limitless’

The deal comes just days after Sergio Gor took charge as the US Ambassador to India. Minutes before the announcement, he hinted at the development on X, writing, “President Trump just spoke to PM Modi. STAY TUNED...”

After the deal was announced, Gor welcomed the decision and highlighted the strength of the bilateral relationship.

“As I have said many times, President Trump genuinely considers Prime Minister Modi a great friend! Thrilled by the news of the trade deal this evening. The relationship between the United States and India has LIMITLESS POTENTIAL!” he posted.

Gor later confirmed that the additional 25% tariffs imposed on India were also removed. Speaking to CNN News 18, he said the final tariff rate would be 18%.

“That is correct. As you saw in the Truth of the President wrote, part of the agreement is that all nations around the world stop buying oil from Russia in order to bring peace. I know the Prime Minister deeply cares about bringing peace in that conflict, as does President Trump. So the number, as it gets finalised, will be 18 per cent,” Gor said.

Earlier, President Trump had only mentioned a reduction from 25% to 18% in his Truth Social post, without clearly stating the status of the extra tariffs.

Commerce Minister Piyush Goyal and External Affairs Minister Dr. S. Jaishankar welcomed the development and shared PM Modi’s post on X, signalling strong support from the government for the landmark deal.

The agreement marks a significant step forward in India-US trade ties after a prolonged period of uncertainty.