India and the United States are reportedly inching toward a trade deal, with Prime Minister Narendra Modi’s government now considering reining in purchases of Russian oil—a key point of contention for President Donald Trump in recent negotiations.
The trade partners are getting close to solidifying a trade agreement that would see India’s steep, 50 percent tariffs cut down to just 15-16 percent, according to New Delhi-based outlet Mint, which cited individuals familiar with the dealings.
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India is weighing the possibility of pulling back gradually on Russian oil imports, the factor that prompted the Trump administration to levy 25 percent punitive duties on top of a 25 percent “reciprocal” tariff in August. The decision will have sizable implications for India’s energy sector, with Russia making up about 34 percent of crude oil imports. Meanwhile, the country purchases about 10 percent of its oil and gas from the U.S., Mint stated.
Trump confirmed the conversations during a White House celebration of Diwali on Tuesday.
“I spoke to Prime Minister Modi today…And we just have a very good relationship. And he’s not going to buy much oil from Russia,” he said. “He wants to see the war end with Russia-Ukraine. And, as you know, they’re not going to be buying too much oil. So they’ve cut it way back and they’re continuing to cut it way back.”
While Russia has been a central talking point in the protracted negotiations, the sources said that the parties have also been discussing U.S. agriculture—especially in the wake of the dearth of business American farmers have faced since China majorly drew down on purchasing U.S. soybeans. The crop traditionally represents the biggest U.S. export to China, with farmers exporting over half their yield to the country last year. In 2025, however, that volume has dropped by nearly 78 percent.
As a result, Washington is angling for a new home for crops like non-GMO corn and soymeal, and India is weighing the possibility of importing more of those goods for consumption by both humans and livestock. Greater market access is also being discussed for dairy inputs and ethanol, the unnamed sources said.
Since tensions ratcheted up between the two countries and the 50 percent tariffs on India went into effect, bilateral trade has plummeted.
According to a report released by the Global Trade Research Initiative this week, India’s exports to the U.S. fell by 20.3 percent in September to $5.5 billion, marking the fourth consecutive month of losses. According to the reporting, the sectors most impacted by the trade détente include textiles and apparel, jewelry, chemicals and industrial products.
