India-US Trade Deal: Explained the Benefits, Risks and Political Debate

India and the United States announced a trade deal after a phone call on Monday, with tariffs on Indian goods being lowered to 18% from 25%.

The US claimed India had agreed to stop purchasing Russian oil and replace it with supplies from the US and Venezuela. However, India has not publicly confirmed any such oil-related commitment.

As part of the agreement, Prime Minister Narendra Modi is said to have committed to boosting purchases from the US worth $500 billion (approx ₹41.5 lakh crore) across sectors including energy, technology, agriculture and coal.

In a social media post shortly after the call with Modi, US President Donald Trump said he was announcing the deal “out of friendship and respect for PM Modi and, as per his request, effective immediately,” adding that “our amazing relationship with India will be even stronger going forward.”

Modi confirmed the agreement minutes later, writing: “Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement.”

The Congress criticised the India-US trade deal, warning that it could turn “Make in India” into “Sell India.” The party alleged that the agreement may open domestic markets to foreign products at the cost of local manufacturers and small businesses.

Congress MP Shashi Tharoor also raised concerns over US claims that the deal would bring $500 million (approx ₹4,150 crore) in investment. He questioned where the money would come from and whether it reflected firm commitments or only projections, stressing the need for greater transparency.