President Donald Trump earlier announced a trade deal that slashes US tariffs on Indian goods to 18 per cent from 50 per cent in exchange for New Delhi halting Russian oil purchases and lowering trade barriers.
"Out of friendship and respect for Prime Minister Modi and, as per his request, effective immediately, we agreed to a Trade Deal between the United States and India, whereby the United States will charge a reduced Reciprocal Tariff, lowering it from 25 per cent to 18 per cent," Trump said in a social media post following a call with Indian Prime Minister Narendra Modi.
A White House official told Reuters that the US was rescinding a punitive, 25 per cent duty on all imports from India over its purchases of Russian oil that had stacked on top of a 25 per cent "reciprocal" tariff rate.
Modi also committed to buy more than $US500 billion ($A720 billion) worth of US energy, technology, agricultural and other products, Trump added.
"Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18 per cent," Modi said in a social media post on X.
"Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement."
An Indian government official, who did not want to be named, said India has agreed to buy US goods including telecom and pharmaceuticals and offered market access for some agricultural products, as part of New Delhi's commitments under the deal.
India recently offered select market access for agricultural products to the European Union under a trade deal.
The Asian nation has also lowered tariffs on imported cars to address Washington's immediate US demands to conclude the first tranche of the deal, the official added.
The deal comes after months of tense trade negotiations between the world's two largest democracies.
Last August, Trump doubled duties on imports from India to 50 per cent to pressure Indian firms to stop buying Russian oil, and earlier this month said the rate could rise again if it did not curb its purchases.
India's exports to the US rose 15.88 per cent year-on-year to $US85.5 billion in January-November, while imports stood at $US46.08 billion, Indian government data showed.
"The commitment to buy US products covers sectors like pharmaceuticals, telecom, defence, petroleum and aircraft. It will be done over the years," the Indian government official told Reuters.
The official said a more comprehensive pact with the US will be negotiated over coming months.
