India's Modi praised for US trade deal as opposition questions impact on
agriculture
[February 03, 2026] By
RAJESH ROY
NEW DELHI (AP) — Indian lawmakers from the ruling coalition praised
Prime Minister Narendra Modi on Tuesday for striking a deal with the
U.S. that seeks to reduce tariffs on Indian goods, while the opposition
raised questions on the impact on sensitive sectors such as agriculture.
President Donald Trump on Monday announced he plans to reduce import
tariff on India, six months after imposing steep taxes to punish New
Delhi for its unabated purchase of Russian oil that he claimed helped
fuel Moscow’s war machine against Ukraine.
In a social media post, Trump said Modi has agreed to stop purchasing
Russian oil, though the Indian government remained tight-lipped if this
was the case.
US promises to reduce tariffs on India
Trump said he would bring down the tariffs from 25% to 18% in return for
India agreeing to stop Russian crude purchases. New Delhi will also
start to reduce its import taxes on U.S. goods to zero and buy $500
billion worth of American products, Trump said.
“This will help END THE WAR in Ukraine, which is taking place right now,
with thousands of people dying each and every week!” Trump wrote in a
Truth Social post Monday.
Modi posted on X that he was “delighted” by the announced tariff
reduction and that Trump’s “leadership is vital for global peace,
stability, and prosperity.” There has been no word beyond this from the
Indian side on the scale and scope of the trade deal.
Penal tariff for Russian oil purchases to go
Trump didn’t categorically mention if he will remove the additional 25%
tariff on India for purchase of Russian crude, but a spokesman at the
U.S. Embassy in New Delhi late Monday confirmed that “the final tariff
will be 18%.”
This effectively means that the penal tariff will be dropped, in a
respite for Indian exporters who had been facing the heat due to a
combined steep tariff as high as 50%.
India emerged as the second-largest buyer of discounted Urals, upsetting
Washington. India has previously stated that its energy purchases were
guided by market conditions and needs of 1.4 billion people but never
made it clear if it will reduce or stop Russian purchases.
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U.S. President Donald Trump and Indian Prime Minister Narendra Modi
shake hands before their meeting at Hyderabad House, Feb. 25, 2020,
in New Delhi, India. (AP Photo/Alex Brandon, file)
 Opposition makes a stir in
Parliament over agriculture
Opposition political parties are demanding Modi come clear on the
trade deal as it will impact sensitive sectors such as agriculture.
They disrupted the proceedings at the lower house, which was
adjourned for the day.
While the U.S. has been seeking greater market access and zero
tariff on almost all its exports, India has in the past opposed
throwing open sectors such as agriculture and dairy, which employ a
bulk of the country’s population.
U.S. Secretary of Agriculture Brooker Rollings on X thanked Trump
for taking care of American farmers, saying the deal will help
export more American farm products to India’s massive market,
lifting prices and pumping cash into rural America.
In 2024, U.S. agriculture trade deficit with India was $1.3 billion.
Analysts urge caution
A senior official at India’s Finance Ministry, Arvind Shrivastava,
said Tuesday that the trade deal will “further expand and deepen
trade between two of the largest economies of the world.”
He said it will create more opportunities for India’s
labor-intensive and manufacturing sectors in the U.S. market and
give impetus to mutually beneficial collaboration in high and
advanced technology sectors.
An Indian trade analyst, Ajay Srivastava, cautioned India shouldn’t
rush to celebrate Trump’s trade announcement.
What products are covered, what the timelines are and whether India
has agreed to zero tariffs and zero nontariff barriers, especially
in sensitive areas like agriculture, needs to be clarified, he
added.
Reaching $500 billion worth of imports of American goods would
require at least two decades as the present imports are just about
$50 billion, Srivastava said.
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