Thu Feb 05 08:44:04 UTC 2026: ### India and US Set to Finalize Trade Deal, India to Cease Russian Oil Imports

The Story:

Sources speaking to NDTV revealed that the highly anticipated India-US trade deal is expected to be signed early next week. The agreement reportedly includes the US reducing reciprocal tariffs to 18 percent. A significant component of the deal involves India ceasing its oil purchases from Russia, marking a notable shift in India’s energy policy and geopolitical alignment.

Key Points:

  • The India-US trade deal is expected to be signed early next week.
  • The US will slash reciprocal tariffs to 18 percent.
  • India will stop importing oil from Russia as part of the agreement.

Critical Analysis:

The context provided reveals a timeline of expectations and confirmations leading to this point. Piyush Goyal’s statements on February 5, 2026, indicated a finalization within 4-5 days. The Moscow reaction, framed as “Delhi Is Free…”, suggests a degree of understanding, and possibly acceptance, of India’s decision to align with the US on energy policy. The US likely used the trade deal to leverage India away from Russian oil, capitalizing on the geopolitical climate following the war in Ukraine.

Key Takeaways:

  • The India-US trade deal is likely a strategic move by the US to isolate Russia economically.
  • India is willing to make significant economic adjustments, including altering its energy sourcing, to strengthen ties with the US.
  • The 18 percent reciprocal tariff suggests a compromise that benefits both nations, albeit with potential domestic challenges for some sectors.
  • Moscow’s seemingly nonchalant response might be a facade, hiding deeper concerns about losing a major oil importer.

Impact Analysis:

This deal has several potentially long-lasting effects:

  • Geopolitical Realignment: This move firmly places India within the US sphere of influence, particularly concerning economic and energy policies.
  • Energy Market Impact: India’s cessation of Russian oil imports will force Russia to find alternative markets, potentially impacting global oil prices and trade flows. It will also require India to secure new reliable oil suppliers.
  • Bilateral Trade Boost: Reduced tariffs are anticipated to stimulate trade between India and the US, fostering economic growth and cooperation. However, certain sectors may experience increased competition, requiring adaptation and potential government support.
  • Strategic Partnership Strengthening: The deal signals a strengthened strategic partnership between the US and India, potentially leading to increased cooperation on defense, technology, and other critical areas.

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