Washington D.C. – In a move signaling a significant recalibration of trade relations, the United States has lifted the additional 25% tariff imposed on Indian goods. The decision, formalized through an executive order signed by President Donald Trump, took effect on February 7, 2026, at 12:01 am Eastern Standard Time. This action follows India's commitment to halt direct and indirect imports of Russian oil.

The tariffs, initially imposed in August of the previous year, were part of reciprocal trade measures in response to India's continued procurement of Russian crude oil. The U.S. had asserted that India's purchases indirectly supported Russia's military actions against Ukraine. These tariffs significantly impacted Indian exporters across various sectors.

According to the White House, the decision to remove the tariffs was based on a review of additional information and recommendations from senior U.S. officials. The U.S. administration has stated that it will closely monitor India's compliance with its commitment to cease Russian oil imports and that the Secretary of Commerce may recommend the reimposition of tariffs if imports resume.

In tandem with the tariff rollback, the United States and India have reportedly agreed upon a framework to expand defense cooperation over the next decade. Furthermore, India has agreed to increase its purchases of American energy products. A White House statement indicated India intends to purchase $500 billion worth of U.S. energy products, aircraft and parts, precious metals, technology products, and coking coal over the next five years.

The new trade agreement also includes a reduction in tariffs on Indian goods entering the U.S. market from 50% to 18%. In return, India has agreed to lower its trade barriers on American products. The U.S. will apply a reciprocal tariff rate of 18 percent on originating goods of India, including textile and apparel, leather and footwear, plastic and rubber, organic chemicals, home décor, artisanal products, and certain machinery.

The agreement represents a significant reduction in US duties on Indian goods, which had stood at 50 percent late last year. The easing of tariffs follows months of strain between the two countries over India's Russian oil imports, which Washington has argued indirectly support the conflict in Ukraine.

While the details are still emerging, the interim agreement is expected to encompass the elimination or reduction of tariffs on U.S. industrial goods and a range of food and agricultural products, including dried distillers' grains, red sorghum, tree nuts, fresh and processed fruit, soybean oil, wine, and spirits. The US will also remove the reciprocal tariff on a wide range of goods identified in the Potential Tariff Adjustments for Aligned Partners Annex to Executive Order 14346 of September 5, 2025, including generic pharmaceuticals, gems and diamonds, and aircraft parts.