US may cut India tariff rate to 15-16%, according to Mint
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India and the US are nearing a trade deal that would cut tariffs on Indian exports and curb Russian oil imports in exchange for expanded US agricultural access.
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Indian Prime Minister Narendra Modi and US President Donald Trump, right, shake hands after introductions during the "Howdi Modi" event, on September 22, 2019, at NRG Stadium in Houston. (AP Photo/Michael Wyke, File)
India and the United States are on the verge of finalizing a trade agreement that could significantly reduce tariffs on Indian exports, from around 50% to approximately 15%–16%, according to a report by Mint citing three individuals familiar with the negotiations, Bloomberg wrote.
The deal, which is still being finalized, may be formally announced during a possible meeting between US President Donald Trump and Indian Prime Minister Narendra Modi at the upcoming Association of Southeast Asian Nations (ASEAN) summit in Kuala Lumpur, scheduled for October 26–28.
As part of the agreement, New Delhi may agree to gradually reduce its imports of Russian oil. While India has not officially confirmed such a commitment, state refiners have signaled a cut in Russian crude purchases. This comes after India denied Trump’s claims about ending Russian oil imports. Reliance Industries Ltd., India’s largest private buyer of Russian oil, has already shifted its sourcing strategy toward Middle Eastern suppliers.
Trump stated on Tuesday that Modi had assured him India was "not going to buy much oil from Russia," echoing similar remarks made earlier this month. The reported concession comes amid continued US efforts to curb global Russian energy flows following the start of the war in Ukraine in 2022. Currently, Russian oil accounts for roughly one-third of India’s total crude imports.
US to gain access for corn and soymeal exports
In exchange, India is expected to allow greater access for US agricultural exports, specifically non-genetically modified corn and soymeal. These commodities have previously faced restrictions in the Indian market due to domestic regulatory and trade barriers.
The proposed India-US trade deal is likely to strengthen agricultural ties while offering US farmers new export markets, and the inclusion of non-GMO crops aligns with India’s strict import standards.
Though officials from India’s Commerce Ministry did not respond to requests for comment, and the US embassy in New Delhi referred queries to the Office of the US Trade Representative, sources indicated to Bloomberg that an announcement could come during the ASEAN Leaders Summit in Malaysia later this month.
According to the Mint report, trade negotiators from New Delhi made substantial progress during recent talks in the US. An Indian official noted over the weekend that both sides were working diligently to finalize the terms of the agreement, which could mark a significant milestone in India-US economic relations.
Moreover, India emerged as a major importer of discounted Russian crude following the outbreak of war in Ukraine. However, under mounting US pressure and broader geopolitical considerations, New Delhi appears prepared to recalibrate its energy import strategy in exchange for improved trade access.
If finalized, according to Mint, the India-US trade deal would represent one of the most substantial bilateral economic agreements between the two nations in recent years, with far-reaching implications for tariffs, energy, and agricultural trade.
