United States Strikes Trade Understanding With India, But It Will Not Affect Metals Tariffs

Last week, U.S. President Donald Trump announced his administration had reached a trade understanding with the government of India that would lower the reciprocal tariff applied to imports of Indian goods into the United States from 25 percent to 18 percent.

That penalty is not the only one that President Trump said he would cut. The U.S. commander in chief had imposed a 25 percent surcharge on India in August 2025 in response to that country’s continued purchases of oil from Russia. President Trump said Indian officials had committed to halting those purchases and so the U.S. government would end that penalty as well.

The agreement does not alter the United States’ Section 232 tariffs on steel and aluminum, however.

In exchange for the U.S. trade policy changes, the government of India will eliminate or reduce tariffs on all U.S. industrial goods and a wide range of U.S. food and agricultural products and, over the next five years, will purchase $500 billion of U.S. energy products, aircraft and aircraft parts, precious metals, technology products, and coking coal.

As part of the agreement, which is outlined by the White House at this link, the two countries have agreed to:

• Strengthen their economic security alignments in order to enhance supply chain resilience and innovation through complementary actions that address non-market policies of third parties;
• Cooperate on inbound and outbound investment reviews and export controls;
• Commit to provide each other with preferential market access in sectors of respective interest on a sustained basis; and
• Address non-tariff barriers that affect bilateral trade.

Both governments described the tariff change as part of a broader effort to expand bilateral trade and address market access issues.