US-India Trade Deal Cuts Tariffs to 18%
US-India trade deal announced Feb. 2, 2026 cuts U.S. tariffs to 18% and includes a $500 billion buy-American pledge, prompting export reassessment.
KEY TAKEAWAYS
- U.S. reciprocal tariff on Indian goods reduced to 18.0% from 25.0% following the announcement.
- India pledged to stop buying Russian crude, prompting removal of a Russia-linked 25.0% tariff.
- India pledged buy-American coverage exceeding $500.0 billion, well above recent import baselines.
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President Trump announced on Feb. 2, 2026, that the US-India trade deal lowers the U.S. reciprocal tariff on Indian goods and follows India's pledge to stop purchasing Russian crude oil, the White House confirmed.
Tariff Reductions and Russian Oil Commitment
The White House said the administration would immediately reduce the U.S. reciprocal tariff on Indian goods from 25% to 18% and drop a separate 25% tariff imposed over India’s purchases of Russian crude oil. The removal of the Russia-linked tariff was tied to India’s pledge to stop buying Russian crude.
Trump announced the deal on Truth Social after a phone call with Prime Minister Narendra Modi, who thanked the U.S. president on X, writing, "Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement." The White House had not issued a formal executive order or detailed fact sheet at the time of the announcement.
Purchase Commitments and Import Baseline
India committed to eliminate tariffs and non-tariff barriers on U.S. goods, pledging to reduce them to zero. The announcement included a buy-American pledge covering more than $500 billion in U.S. energy, technology, agricultural, coal, and other products.
This pledge is large compared with recent trade flows: India imported about $87 billion in U.S. goods in 2024 and roughly $100 billion in 2025. The gap highlights the scale of expansion implied by the commitment and the need for exporters across energy, technology, and agriculture to increase shipments substantially to meet the target.
