US-India Trade Deal: Tariffs Slashed to 18% Amidst Energy and Oil Negotiations

New US-India Trade Agreement

• 🤝 A new trade deal has been announced between the US and India, following a phone call between President Trump and Prime Minister Narendra Modi.
• 📉 US tariffs on Indian goods are set to be slashed from 50% to 18% as part of this agreement.

India's Shifting Energy Purchases

• 🛢️ In exchange for reduced tariffs, India has agreed to halt its purchases of Russian oil.
• 🇺🇸 India will instead buy more oil and other products from the United States, with potential purchases from Venezuela also mentioned.
• 💰 Prime Minister Modi committed to purchasing over $500 billion worth of US energy, technology, agricultural, and other products.

Background and Market Impact

• 📈 The deal aims to pressure Russia's war machine and comes after months of tense trade negotiations.
• ⚠️ Previously, the US had imposed a 25% duty on imports from India, which was on top of another reciprocal tariff, to pressure New Delhi regarding Russian oil purchases.
• 📉 Indian markets had been negatively impacted by these tariffs, making it the worst-performing emerging market in 2025.
• 🇨🇳 The agreement also touches upon China's potential to buy oil, with a mention of China being welcome to participate in oil purchases.