After a telephone conversation with Indian Prime Minister Narendra Modi, President Trump has announced a new trade deal with India that cuts tariffs and provides that India will buy oil from the U.S. and our new ally Venezuela, rather than Russia. Reuters reports:
Here’s what happened on Monday:
* Trump announced the deal on social media following a call with Modi. The deal slashes U.S. tariffs on Indian goods to 18% from 50% in exchange for India halting Russian oil purchases and lowering trade barriers.
* He noted that India would now buy oil from the U.S. and potentially Venezuela. A White House official told Reuters that the U.S. is rescinding a punitive 25% duty on all imports from India over its purchases of Russian oil that it had stacked on top of a 25% tariff rate.
* Modi expressed “Big thanks to President Trump on behalf of the 1.4 billion people of India” in a social media post on X.
* U.S.-listed shares of major Indian companies rallied on the news.
* Trump’s Truth Social message provided few details, including on the start date for the lower tariff rates, the deadline for India to end Russian oil purchases, trade barrier reductions and which U.S. products India had committed to purchasing.
* As of late Monday afternoon, the White House had not issued a presidential proclamation nor a Federal Register notice required to make the changes official. India’s commerce and foreign ministries did not immediately respond to requests for comment sent after working hours.
This is typical: Trump announces a major policy achievement on Truth Social rather than through traditional channels. Also typical is Trump’s strategy of announcing a major change–in this case, a big increase in tariffs on Indian goods–followed by a negotiation that results in a more moderate policy that is good for the United States. I am not sure whether there are actually reporters who have not yet figured this out, or whether they are all being deliberately obtuse.
Finally, Trump’s power to impose tariffs under various statutes is currently being litigated in the Supreme Court. I think the Court likely will hold (probably correctly) that Trump does not have at least some of the authority over tariffs that he has exerted, thus limiting a tactic that has done considerable good. This is a valuable reminder that a correct interpretation of the statutes at issue does not necessarily yield what is best, in policy terms, for the U.S. But opening the door to good policy, regardless of statutory language, is not the Supreme Court’s job. Laws say what they say. They do not say what we–or the Democrats!–might wish them to say.
