By Admin 
US President Donald Trump on Monday (February 2, 2025) not only announced a trade deal and tariff reduction with India on social media platform X, but also praised Prime Minister Narendra Modi. Experts believe that the reason for this big change in Trump’s stance could be the recent Free Trade Agreement (FTA) with the European Union. He says that due to FTA, there was pressure on America to make a trade agreement with India.
Farwa Amer, director of South Asia Initiatives at the Asia Society Policy Institute, said on Monday that even though talks were already going on about a trade deal between India and America, the deal with the European Union has played a role in speeding up the process for America. He said the timing of the agreement is also interesting, as it came right after the EU’s FTA.
Prime Minister Narendra Modi and US President Donald Trump announced that a trade agreement has been signed between the two countries. Under this, America will reduce the duty on exports from India from 25 percent to 18 percent. According to the White House, America will also remove the additional punitive duty of 25 percent imposed on India for buying Russian oil. This success was achieved after negotiations that lasted for about a year. During this period, the talks between the two countries went through difficult times many times. This agreement was announced after a phone conversation between PM Modi and President Trump.
Farwa Amer said that questions related to Russia are still important for India. Even though India is making changes in its oil imports, it wants to keep its relations with Russia balanced. Amer said, ‘For India, the question of Russia remains. Even though it has and will change its oil import pattern from Russia, India would still like to keep the relationship stable. As far as the India-US trade deal is concerned, the talks at the top leadership level made this agreement possible.
Another trade expert Wendy Cutler says that this agreement will give India an advantage compared to the countries of South-East Asia. There will be 18 percent duty on Indian products in America, while this duty on ASEAN countries will be between 19 to 20 percent. This will give a slight advantage to Indian exporters.
Cutler, senior vice president of ASPI and former acting US Trade Representative, said it was likely the US got a better deal than the EU. He said that India has talked about reducing tariff and non-tariff barriers, but President Trump’s language is not clear on this. However, Trump has said in his social media post that India will move towards reducing tariff and non-tariff barriers against America to zero.
Overall, Cutler said the India-US agreement will pave the way for the US and India to work together on other important matters related to critical minerals, technology cooperation and supply chain resilience. Meanwhile, External Affairs Minister S Jaishankar has left for America on a tour, where he will participate in the ministerial meeting on important minerals.