President Donald Trump on Monday announced he would reduce tariffs on Indian goods in exchange for, among other things, a promise to stop buying Russian oil.
That will be a tall task: India has been importing roughly 1.5 million barrels of Russian oil each day – even months after Trump placed tariffs on Indian goods as punishment – according to Kpler, a global trade data provider.
Trump said in a social media post that he spoke Monday morning with Indian Prime Minister Narendra Modi, who agreed to replace the country’s Russian crude imports with oil from Venezuela and the United States. Venezuelan oil is of the same quality as Russian oil – heavy, sour and perfect for making derivatives like fuel oil and diesel.
It’s not clear, however, how long that transition may take. Venezuela’s oil infrastructure is dilapidated and requires about a decade of work and tens of billions of investment dollars to return it to the more-than-3 million barrels a day output it had achieved before the country’s Socialist government took control in 1999.
That may be why Trump’s tariff reduction on India was less pronounced than the reduction achieved by some trade frameworks with other countries. Trump said Indian goods would immediately face an 18% tariff, down from 25%. It’s not immediately clear whether or not the additional 25% tariff for purchasing Russian oil would remain in place.
India and China are among the primary buyers of Russian oil, which has been sanctioned by most Western countries because of Russian President Vladimir Putin’s war with Ukraine.
Trump, calling Modi “one of my greatest friends,” also said India’s prime minister agreed to reduce India’s tariffs on US goods to zero,and to remove unspecified non-tariff barriers. Although Trump didn’t explain which barriers would be removed, those often include special taxes on US companies’ services or value-added taxes on goods.
India also pledged to invest in American goods “at a much higher level” in addition to a $500 billion invesment in US energy, technology, agriculture and coal among other products, Trump said.
Although India isn’t one of America’s largest trading partners, the reduction in tariffs could nevertheless make a meaningful dent: The United States imported $95.5 billion in goods from India in 2025, and it exported $42 billion of goods to India last year, according to the US Census Bureau.
This is a developing story and will be updated.
