US President Donald Trump announced on February 3 that the United States and India have reached a new trade deal, following a phone conversation with Indian Prime Minister Narendra Modi. However, no official joint statement or formal agreement text has been released, leaving key elements of the proposed deal unclear.
According to preliminary information circulating after Trump’s social media post, India is expected to remove tariffs and non-tariff barriers on US goods, while US tariffs on Indian exports may be reduced to 18% from the previous 25% level. These details have not been formally confirmed by the Indian government.
Prime Minister Modi publicly welcomed the announcement, stating that “Made in India products will now have a reduced tariff of 18%.” Despite these remarks, both governments have so far refrained from publishing information on the scope, timelines, legal framework, or enforcement mechanisms of the deal.
The announcement follows a period of heightened trade tensions. In August 2025, the US raised tariffs on Indian goods to 50%, citing India’s continued purchases of discounted Russian crude oil. Trump had previously linked any trade agreement to reduced Indian imports of Russian oil, an issue not addressed in the latest announcement.
Trade experts have urged caution. Ajay Srivastava of the Global Trade and Research Initiative (GTRI) said several critical questions remain unanswered, including which products are covered, whether zero tariffs apply across sensitive sectors, and how commitments would be enforced.
He also questioned Trump’s claim that India agreed to purchase over $500 billion in US energy, technology and agricultural goods, noting that India’s current annual imports from the US are below $50 billion.
Until formal documentation is released, analysts say the announcement should be viewed as a political signal rather than a finalized trade agreement.
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