India and the United States have reportedly finalized a bilateral trade agreement (BTA), marking a significant breakthrough in their trade relations. The agreement is expected to be signed after the conclusion of documentation.

The announcement signals a thaw in relations between the two countries, which had been strained by tariffs imposed by the U.S. Negotiations for this BTA have been ongoing since February of last year, with the goal of reaching $500 billion in trade by 2030, a substantial increase from the current $191 billion. The U.S. is currently India's largest trading partner, with bilateral trade valued at $131.84 billion.

U.S. President Donald Trump announced the trade deal on Monday, stating that the U.S. would lower tariffs on Indian goods from 25% to 18%. Trump also stated that India would reduce its tariffs and non-tariff barriers on U.S. goods to zero. Additionally, the White House indicated that the additional 25% tariff imposed on India for its purchases of Russian oil would be dropped. Trump mentioned that Indian Prime Minister Narendra Modi agreed to cease purchasing Russian oil and increase purchases from the U.S. and potentially Venezuela.

Prime Minister Modi responded to President Trump's announcement, expressing his appreciation and noting that the collaboration between the two largest democracies would benefit their citizens and unlock significant opportunities. He acknowledged the reduction in tariffs on Indian products to 18%.

The trade deal has been welcomed by officials from both countries. Indian Finance Minister Nirmala Sitharaman said the deal was "good news for Made in India products". U.S. Ambassador to India, Sergio Gor, expressed his excitement about the trade deal and emphasized the "limitless potential" of the relationship between the United States and India.

The agreement comes just days after India concluded a comprehensive trade agreement with the European Union. With trade deals now in place with the U.S. and the EU, India has established strong trade agreements with two of the world's largest economic blocs.