TMTPOST --   India   is   reportedly   closer   to a   trade deal   to cut its   imports of Russian   oil   and lower   tariffs   imposed by the Trump administration.

AI Generated Image

The upcoming trade agreement   could slash U.S. tariffs on Indian   exports to around   15% to 16%   from the   current 50%,   Indian news media outlet Mint   on Tuesday   cited   people familiar with the matter. In return, India is likely to gradually scale down   imports   of Russian   oil, which now marks up   about 34% of India ’ s oil   purchases, according to the local   report.

Besides   energy,   agriculture   is reported   to   be another key area under   negotiation. Washington   and New Delhi   are   said   to discuss India ’ s greater market access for   non-genetically modified corn and soybean   from   the U.S., though dairy   and other sensitive issues   remain unresolved.

New   Delhi   is also said to be considering raising its import quota for non-genetically modified U.S.   corn even with a import duty of 15%, while pushing for a mechanism under which both sides can revisit tariffs and market access over time.

The deal   could be announced at the Association of Southeast Asian Nations   ( ASEAN )   summit later   this month during a   meeting between U.S. President Donald Trump and Indian Prime Minister   Narendra Modi.

Trump on August 6   signed   an   executive order imposing an additional 25% tariff on imports from India   over Russian oil   purchase.   The new tariffs entered   into   effect 21   days after   announcement of the   order, which effectively raised   tariffs imposed by the U.S. on Indian goods   to 50% in August.   India   accordingly   became one of   the countries   facing   the highest   U.S. tariffs   that   month.  

Trump   last week said   Modi told him the Indian government will halt purchases   of sanctioned Russian oil. Trump   acknowledged India   can   not stop   oil shipments   immediately. He   said   the halt   will   be   "a   little bit of a process, but   the process is going to be over with soon."   He   didn ’ t   provide   an exact timetable, while   seeing India ’ s   oil   purchase   will   restart once Moscow ’ s war   in   Ukraine   ends.

"If India doesn ’ t buy [ Russian ] oil, it makes [ ending the war ] much easier," Trump said   on on   October 15. "They assured me within a short period of time, they will not be buying oil from Russia, and they will go back to Russia after the war is over."  

India's foreign ministry said   a   day ago   that it is unaware of any conversation between the two   heads of state   around New Delhi reducing its Russian oil buys and stepping up its purchase of US crude oil and natural gas.

"To the best of our knowledge, I am not aware of any conversation between PM Modi and President Trump yesterday," Randhir Jaiswal, a spokesman for the Ministry of External Affairs, told reporters at a briefing in New Delhi on October 16. In a statement earlier   that day, Jaiswal didn ’ t confirm that India is complying with Trump ’ s demands, although said that New Delhi is working to deepen energy ties with the US.

Trump on   Sunday promised to maintain   "massive"   tariffs   on   imports from   India   until   it   stops purchase   of Russian oil.   "I spoke with Prime Minister Modi of India, and he said he's not going to be doing the Russian oil thing," Trump told reporters   on board   Air   Force One.

"If they want to say that, then they'll just continue to pay massive tariffs, and they don't want to do that,"   Trump   replied   when asked about   New Delhi ’ s denying   the   telephone   conversation   took   place.

Trump on   Tuesday reiterated a phone   call with Modi,   stating   the   prime   minister assured him   that the   Indian government would reduce   buying Russian   oil. "He ’ s not going to buy much oil from Russia. He wants to see that war end as much as I do. He wants to see the war end with Russia, Ukraine, and as you know, they ’ re not going to be buying too much oil," Trump said aboard Air Force One. He repeated his threat   of "massive"   tariffs if India didn ’ t   do so.

Modi   in   a post on X   on Wednesday   confirmed a phone call with Trump. He said he hoped the two countries continue to "stand united against terrorism in all its forms," without mentioning India ’ s stance on Russian oil.