US lifts extra 25% tariffs on Indian goods linked to Russian oil buys

The US on Saturday announced it would remove the additional 25 per cent tariffs imposed on Indian goods linked to the purchase of Russian oil, marking a key step in easing trade tensions between the two countries.

According to an executive order issued by the White House, the removal of the extra duties will take effect from 12.01 am Eastern Standard Time on February 7, 2026. From then on, Indian products imported into the US will no longer face the additional tariff imposed under an earlier executive order. The elimination of the additional 25 per cent duty will offer major relief to Indian exporters, whose products had faced combined tariffs of up to 50 per cent since last summer.

President Donald Trump said the decision followed assurances from India that it would halt purchases of Russian crude and increase its reliance on US energy supplies. He also cited India’s agreement to a framework aimed at expanding defence cooperation with Washington over the next decade.

India to import $500 bn of US goods

The rollback of tariffs comes as part of a broader trade understanding announced earlier this week after a phone call between Trump and PM Narendra Modi. A joint statement said India plans to purchase goods worth around $500 billion from the US over the next five years.

These purchases are expected to include energy products, aircraft and aircraft parts, precious metals, technology products and coking coal. The two sides also said they would significantly expand trade in advanced technology products, including graphics processing units and other equipment used in data centres.

‘Conditional’ relief

The executive order makes clear that the relief is conditional. If the US Secretary of Commerce determines that India has resumed importing Russian oil, Washington could consider reimposing the additional duties.

As part of the deal, the US will remove tariffs on certain aircraft and aircraft parts, while India has agreed to address non-tariff barriers affecting US agricultural and food products. India will also receive preferential tariff rate quotas for automobile parts and generic pharmaceuticals.

US Trade Representative Jamieson Greer said further work would be required from New Delhi to fully eliminate trade barriers, but described the agreement as a step towards deeper economic ties.

‘Trade pact to open $30 trillion US market for Indian exporters’

Commerce and Industry Minister Piyush Goyal said the interim trade framework with the US would open up a $30 trillion market for Indian exporters, with particular benefits for MSMEs, farmers and fishermen. He said the expected export push would also create large-scale job opportunities, especially for women and youth.

Goyal said the US would cut reciprocal tariffs on Indian goods to 18 per cent, while duties would drop to zero on products such as generic pharmaceuticals, gems and diamonds, and aircraft parts. He added that sensitive farm and dairy products would remain fully protected to safeguard farmers’ interests and rural livelihoods.