NEW DELHI – In a significant move, coming as a setback for India on the trade front, United States President Donald Trump on Wednesday announced a 25% tariff on Indian goods starting August 1.
Notably, anticipations were high that the US President will give some relaxations and levy the utmost 10% tariff on India.
Announcing the move, he cited India’s ‘high trade barriers’ and continued energy and defense ties with Russia.
Taking it to social media platform X (formerly Twitter), in a strongly worded statement, Donald Trump said while India is a “friend”, it has imposed some of the “highest tariffs” on the United States and maintained “obnoxious” non-monetary trade barriers.
“Remember, while India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country.”
Donald Trump also criticised India’s military and oil imports from Russia, citing Moscow’s war on Ukraine. Along with the tariff, Donald Trump said India would face an additional “penalty” for its relations with Russia and “massive trade deficit”.
“Also, they have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of ENERGY, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE — ALL THINGS NOT GOOD!”
“India will therefore be paying a tariff of 25%, plus a penalty for the above, starting on August first. Thank you for your attention to this matter. MAGA!”” Donald Trump said.
It is to be noted that Donald Trump has repeatedly labelled India a “trade abuser” with “obnoxious non‑monetary trade barriers,” citing its high import duties on American products and lack of alignment with sanctions on Russia.
Earlier in the day, before announcing the tariffs, when asked about the upcoming tariffs on India, Donald Trump had said, “Yeah, I think so. India is my friend. They ended the war with Pakistan at my request…The deal with India is not finalised. India has been a good friend, but India has charged basically more tariffs than almost any other country.”
Notably in April, the Trump administration rolled out its “Liberation Day” tariff plan with a 10% baseline tariff on most imports plus reciprocal tariffs for countries with large trade surpluses, including India.
India responded by committing to tariff reductions on select U.S. imports and seeking a bilateral trade agreement to avoid or scale back these levies.
The new tariffs are expected to impact India’s goods exports to the US including labour-intensive products such as garments, pharmaceuticals, gems and jewelry, and petrochemicals. This was estimated at around $87 billion in 2024.
The Indian rupee is under pressure, with analysts expecting it to weaken further.
ANN/The Statesman
