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TradeDeal – India and the United States have finalised a major trade agreement that leaders from both countries say will strengthen their strategic partnership and expand economic opportunities for businesses and consumers on both sides. The deal includes a reduction in tariffs and commitments aimed at boosting bilateral trade, investment, and long-term cooperation between the two democracies.

Leaders Highlight Strategic Importance of the Agreement

Union Home Minister Amit Shah described the agreement as a milestone in India–US relations, saying it would help elevate ties beyond diplomacy and into deeper economic collaboration. In a message shared on social media, Shah said the deal would benefit citizens of both nations while encouraging stronger commercial engagement between Indian and American companies.

He noted that the agreement marks a significant step forward, particularly due to the decision to lower tariffs, which he said would allow trade flows to expand more freely and sustainably. Shah also congratulated Prime Minister Narendra Modi and US President Donald Trump for finalising what he called a historic understanding between the two countries.

Tariff Reduction Seen as Key Economic Boost

Under the agreement, the United States will reduce reciprocal tariffs on Indian goods from 25 percent to 18 percent. President Trump confirmed the decision following a phone conversation with Prime Minister Modi, describing the move as an outcome of mutual respect and long-standing dialogue.

Prime Minister Modi welcomed the announcement, saying the reduced tariff would improve access for Made in India products in the American market. He thanked President Trump for the decision, stating that it would positively impact India’s manufacturing sector and support economic growth at home.

Focus on Trade, Growth, and Democratic Cooperation

Modi emphasised that collaboration between two of the world’s largest economies and democracies brings tangible benefits to their people. He said such partnerships create opportunities for cooperation across sectors and help promote shared prosperity.

The prime minister also expressed his intention to work closely with the US leadership to take the bilateral relationship to new levels, highlighting the importance of stability, peace, and economic progress in global affairs.

US Commitments and Market Access Plans

President Trump said India has agreed to move toward eliminating tariffs and non-tariff barriers on American goods over time. He added that New Delhi has committed to significantly increasing purchases of US products, including energy, technology, agriculture, and other key sectors.

According to Trump, India is expected to buy American goods worth more than USD 500 billion, with energy imports forming a substantial part of that commitment. He said the agreement reflects a strong personal understanding between the two leaders and a shared goal of delivering results through cooperation.

Broader Discussions During Leader-Level Talks

Beyond trade, the leaders also discussed global issues during their conversation. Trump said the topic of the Russia–Ukraine conflict came up, adding that India agreed to reduce its purchases of Russian oil while exploring alternative energy sources.

He suggested that such steps could contribute to efforts aimed at ending the ongoing conflict, which continues to cause significant human suffering.

Background to the Negotiations

The latest agreement follows months of negotiations that had previously slowed due to disagreements over tariffs. Talks gained momentum again after both sides revisited earlier commitments made during meetings last year, including plans to finalise an initial phase of a broader trade framework.

Officials noted that India’s revised tariff levels now compare favourably with other exporting nations, giving Indian products a competitive edge in the US market. Recent assessments showed higher tariff rates applied to several other Asian economies.

Government sources said negotiators from both countries made substantial progress in recent rounds of discussions, clearing the way for the final announcement of the deal.