Editor’s Note
This article reports on a trade announcement made by former US President Donald Trump in August 2025. The claims within are based on his social media statements and have not been independently verified by our newsroom.
US President Donald Trump announced a significant trade deal with India shortly after imposing a 50 percent tariff on Indian products in August 2025. Trump made the announcement on his social media platform Truth Social, claiming major tariff relief and a shift in India’s stance on energy.
Trump had imposed a total 50 percent tariff on India, of which 25 percent was linked to crude oil imports from Russia. Officials from the Trump administration repeatedly claimed that India’s purchase of oil from Russia was providing economic aid for the war. Based on this, the US adopted a strict tariff policy against India, which was later softened under this new agreement.
1. India will reduce tariffs on products exported from the US to zero.
2. The US will reduce the reciprocal duty imposed on India from 25% to 18%.
3. Trump claimed that India will stop buying crude oil from Russia.
4. India will increase oil purchases from the United States.
5. India may start importing oil from Venezuela in the future.
6. India has committed to purchasing $500 billion worth of American products, including energy, agriculture, coal, and technology.
7. Both countries have agreed to strengthen the ‘Buy American’ policy.
In international trade, tariffs are commonly referred to as customs duties or import duties. It is the tax levied by a country on imported goods. ‘Reciprocal’ means mutual or ‘tit for tat’. When the US announced heavy tariffs on India, India retaliated by announcing similar tariffs on goods coming from the US.
For example, if the US imposes a 25 percent tax on motorcycles made in India, India will impose the same tax on a product coming from the US.
The US decided to immediately reduce the reciprocal tariff imposed on India from 25 percent to 18 percent, taking into account friendly relations with India. In return, India agreed to zero out its tariff and non-tariff barriers against the US and prioritize American products.
According to reports, this agreement will provide a major boost to the US energy, technology, and agriculture sectors. The purchase of $500 billion worth of American goods will strengthen trade relations between the two countries. However, questions are also being raised about the long-term direction policies like reciprocal tariffs will take the global economy and whether Trump’s ‘tariff bomb’ will intensify trade wars with other countries.