SRINAGAR: US President Donald Trump has announced that the United States will introduce a 25 per cent tariff on all goods imported from India starting August 1, citing a persistent trade deficit and India’s ongoing purchases of Russian oil and military equipment.
The announcement, made on Wednesday via statements and social media, marks an escalation in trade tensions between Washington and New Delhi and is expected to have wide-ranging repercussions for both economies. According to Trump, the tariffs are a response to what he called “strenuous and obnoxious” trade barriers imposed by India as well as India’s refusal to reduce purchases from Russia, which the US administration views as undermining Western sanctions over the war in Ukraine.
“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… India will therefore be paying a tariff of 25 per cent, plus a penalty for [its purchases from Russia], starting on August first,” Trump stated.
Analysts say the tariffs are likely to hit Indian exports in sectors such as electronics, pharmaceuticals, and gems, all of which have relied on access to the lucrative American market. The Indian government responded by stating that it is reviewing the implications of the tariff decision and remains committed to negotiations towards a “fair, balanced, and mutually beneficial” trade deal. Commerce ministry sources told Reuters that talks had recently stalled and that the move could threaten an already fragile trade relationship between the two democracies.
Trump’s decision comes alongside new tariffs on several other trading partners, including Brazil and South Korea, as part of an overt push to prioritise American industry and reduce the US trade deficit. According to AP News, India’s $45.7 billion trade surplus with the US in the last year was a frequent point of complaint for Trump throughout his presidency. The Indian tariffs are noticeably steeper than those announced for other countries, which will face tariffs capped at 15 to 20 per cent.
The White House stressed that negotiations with India would continue, with Trump stating, “We’re talking to India now – we’ll see what happens… You’ll know by the end of this week.”
