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Ban on 500 percent high tariff, biggest update so far on India-America trade deal

by Rajiv Mishra
January 15, 2026
in Business
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Ban on 500 percent high tariff, biggest update so far on India-America trade deal
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Recently, US President Donald Trump had threatened to impose tariffs of up to 500 percent on countries buying crude oil from Russia. India has been one of the major countries buying cheap crude oil from Russia, due to which New Delhi’s concerns had increased after this statement. However, India has now significantly reduced its oil purchases from Moscow, and given the current situation, the threat of 500 percent tariff on India is almost over.

The credit for this largely goes to the hope of early completion of the long-pending trade agreement between India and the United States.

Will India-US trade agreement be finalized soon?

Commerce Secretary Rajesh Aggarwal on Thursday said talks are on on a trade deal between India and the United States. He also clarified that despite high tariffs, India’s exports to the US are showing positive growth. Addressing the press, Agarwal said that both sides are negotiating a trade deal and both believe that an agreement in some form or the other is possible. He said that an important meeting was also held digitally last December between Commerce and Industry Minister Piyush Goyal and US Trade Representative Jameson Greer.

What issues have stalled the deal?

Talks on a trade agreement between India and the United States have been going on for a long time, but have not yet reached any concrete conclusion. The main reason for this is that India is not in favor of opening its agriculture and dairy sector to foreign competition. At present, America has imposed a total tariff of 50 percent on India. This includes a 25 percent base tariff, while an additional 25 percent tariff was imposed due to buying cheaper crude oil from Russia. Additionally, the US had announced an additional 25 percent tariff on countries trading with Iran, further increasing India’s concerns.

New hope after the statement

However, the recent statement of the Commerce Secretary clearly shows that the ice between the two countries may melt. If a trade agreement is agreed upon, it will not only avert the threat of additional tariffs on India, but will also strengthen economic ties between the two countries. Experts believe that in the current global scenario, neither India nor the US wants to lose each other as strategic and economic partners, so finalizing a trade agreement is now just a matter of time.

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