Trump announces: Tariffs reduced to 18%
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A few days ago, U.S. President Trump announced that the United States and India had reached a trade agreement that would reduce tariffs on Indian goods, thereby easing tensions between the two countries.
Trump said that after a phone call with Indian Prime Minister Modi, Modi agreed to stop buying Russian oil and the United States would lower the 25% tariff on Indian goods to 18%. According to officials familiar with the matter, Trump will also cancel the additional 25% tariff imposed on India’s purchase of Russian crude oil.
Overall, these measures will reduce the comprehensive tax burden on many Indian commodities from 50% to 18%, significantly reducing the burden on textiles, machinery and other commodities.
Trump said that India will also "promote the reduction of tariff and non-tariff barriers against the United States to zero" and will purchase "more than 0 billion in American energy, technology, agricultural products, coal and many other products."
Trump wrote on social media: "Out of friendship and respect for Prime Minister Modi, and at his request, we immediately agreed to a U.S. trade agreement with India. Our amazing relationship with India will be even stronger in the future."
A White House spokesperson later told CNN that in addition to reducing the so-called "reciprocal tariffs," Trump will also completely cancel the additional 25% tariff imposed to force India to stop buying Russian oil. As of press time, the White House has not released official news on this.
The U.S. government announced on July 31 last year that it would impose a 25% "reciprocal tariff" on Indian goods exported to the United States. This tariff measure came into effect on August 7 of that year. On August 6, Trump signed an executive order to impose an additional 25% tariff on Indian goods exported to the United States on the grounds that India "imports Russian oil directly or indirectly."
India and the United States promised to negotiate a bilateral trade agreement as early as February last year, but differences in stances, especially over crude oil purchases, have led to the delay in reaching a trade agreement.
Modi also posted on social media confirming the agreement between the two parties, saying that "tariffs on products made in India will be reduced to 18%." But he avoided talking about U.S. commodity procurement and oil issues. Indian Commerce and Industry Minister Piyush Goyal said that this agreement will bring the economies of the United States and India closer together.
However, so far, the details of this agreement are limited, including when the lower tariffs will take effect, the deadline for India to stop buying Russian oil, the specific content of the reduction of trade barriers, and the scope of U.S. goods that India has committed to purchase.
