Trump administration imposes higher tariffs than India expected at the last minute, there is a penalty

International Desk 

US President Donald Trump announced a 25% tariff on India and additional penalties for military and energy trade with Russia in a post on his social media platform Truth Social. The tariffs will take effect from August 1, 2025. Although Trump referred to India as a “friend” of America in his post, he criticized India’s high tariffs and tough trade barriers as “unacceptable.” He also said that India has been receiving a large amount of самтые from Russia.

Trump said in his Truth Social post, “India is our friend, but we do relatively little trade with them because they have the highest tariffs in the world and they have harsh and annoying non-tariff trade barriers.” He criticized India’s purchases of military equipment and energy from Russia, saying, “While everyone is telling Russia to stop the war in Ukraine, India and China are the biggest buyers of Russian energy. This is not good at all!” The announcement has sparked renewed tensions over India-US trade.

Earlier in April 2025, Trump announced a 26% retaliatory tariff on India, which was later reduced to 10% for 90 days. However, the new 25% tariff will come into effect from August 1. Trump alleged that India’s average tariff rate is 17%, much higher than the US’s 3.3%. He cited India’s stringent non-tariff barriers, such as complex testing and certification requirements for chemicals, telecom products and medical equipment, as obstacles to US exports.

The Indian government has already taken several steps to address US concerns. In its budget of February 1, 2025, India reduced tariffs on luxury cars, solar cells and appliances, bringing the average tariff rate down from 13% to 11%. It also proposed reducing tariffs on US agricultural products such as almonds, cranberries and bourbon whiskey, and reducing duties on imports of liquefied natural gas (LNG).

Trade talks between India and the United States are at a fever pitch. Indian officials visited Washington on June 23, 2025, and on July 1, Trump said the two countries were close to a deal. However, US Trade Representative Jamieson Greer said in a TV interview on July 28 that talks on agricultural tariffs and the approval of genetically modified soybeans and corn were stalled. The next round of talks is scheduled to begin on August 25.

Indian Commerce Minister Piyush Goyal expressed hope that a win-win deal based on mutual cooperation is possible. However, Trump’s recent posts and tariff announcements have created uncertainty in the Indian market. The Federation of Indian Export Organizations (FIEO) said that the 25% tariff will impact domestic traders.

Experts have warned that the tariffs could have a negative impact on India’s economy. Citibank’s chief India economist, Samiran Chakraborty, said that a 25% tariff could knock 40 basis points off India’s GDP growth in 2025-26. However, India’s exports of seafood and agricultural products like rice are likely to be less affected, as India has tariff advantages compared to Vietnam and Thailand.

The Indian government has yet to officially respond to Trump’s latest announcement. However, India’s commerce ministry said it is examining the impact and scope of Trump’s tariff announcement.