Donald Trump announces 25% tariff on India plus penalty for purchases from Russia (AI image)
NEW DELHI: US president Donald Trump on Wednesday announced that India will have to pay 25 per cent tariff from August 1. Trump also said that India will have to pay an additional penalty for buying energy and arms from Russia. The 25% tariff rate announced for India is 1% less than the 26% declared by Trump in his April 2 ‘Liberation Day’ conference.“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,” Trump said in a post on Truth Social.“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!” he said.
The US president’s announcement of extra penalties against India follows his warning giving Russia a fresh 10-day ultimatum to achieve peace with Ukraine in efforts to halt the conflict.Also Read | Explainer: What do Donald Trump’s 25% tariffs on India mean? What happens if they stay…Trump has indicated possible tariffs on Russia, potentially including secondary charges affecting nations that purchase Russian commodities, particularly oil.The United States and its allies supporting Kyiv consider these oil transactions as implicit backing for Russia, believing they strengthen Moscow’s economy whilst undermining international sanctions.Meanwhile, Trump’s reciprocal tariffs for countries will be effective August 1, 2025, without any further delays. Trump posted on Truth Social, “THE AUGUST FIRST DEADLINE IS THE AUGUST FIRST DEADLINE — IT STANDS STRONG, AND WILL NOT BE EXTENDED. A BIG DAY FOR AMERICA!!!”.
India Reacts To Trump’s Tariffs
India has made it clear that it will put national interest first in finalising any trade agreement. “The Government attaches the utmost importance to protecting and promoting the welfare of our farmers, entrepreneurs, and MSMEs. The Government will take all steps necessary to secure our national interest, as has been the case with other trade agreements including the latest Comprehensive Economic and Trade Agreement with the UK,” a statement from the Ministry of Commerce & Industry reads.The government has said that it is assessing the impact of the 25% tariffs and also added that trade deal negotiations have been ongoing with US. “Over recent months, both India and the United States have participated in discussions aimed at establishing an equitable and reciprocally advantageous trade agreement. The commitment towards achieving this goal remains steadfast,” it said.
India-US Trade Deal Stalemate
Despite announcing the intent for a bilateral trade agreement during PM Narendra Modi’s visit to the US, the two countries have not been able to work out an interim trade deal. Five rounds of talks have taken place between officials of the two countries and a sixth round is slated to take place in August end when a US team will visit India. Yesterday Trump had hinted that India could face tariffs between 20-25% since a trade deal had not been finalized. According to a Reuters report, Indian government officials have said that any tariffs the US may impose from August 1 are likely to be temporary in nature since talks are on to finalise a bilateral trade agreement by fall.Trump has repeatedly called for India to open its market to US goods, but the sticky points in the trade deal talks have been agriculture and dairy sectors. India has hardened its stance on these, refusing to open them.Also Read | ‘Trump frustrated with India trade talks…’: US President feels 25% tariff will ‘remedy’ the situation, says adviser; additional penalty for Russia trade ‘shortly’
