In a sharp turn in U.S.-India trade relations, former U.S. President Donald Trump has announced that a 25% tariff will be imposed on Indian exports to the United States starting August 1. In addition to the tariff, Trump declared an extra penalty on India for continuing to purchase energy and defense equipment from Russia.
The announcement was made through a post on Trump’s social media platform, Truth Social, where he accused India of maintaining excessively high tariffs and restrictive trade practices, while also remaining a key buyer of Russian oil and arms. “India is our friend, but their tariffs are among the highest in the world,” Trump wrote. “They’ve continued buying large quantities of military equipment and energy from Russia at a time when the world wants Russia to stop the killing in Ukraine.”
The 25% tariff is a notch below the 26% Trump had proposed earlier this year during his “Liberation Day” address in April. According to U.S. Commerce Secretary Howard Lutnick, the tariffs and associated penalties will be enforced without any grace period, beginning August 1. “No extensions, no delays. Customs will start collecting from that date,” Lutnick said in a statement.
Trade Deal Still Unresolved
The tariffs come at a time when India and the United States have yet to finalize a long-pending bilateral trade deal. Despite five rounds of negotiations and a clear intent expressed during Prime Minister Narendra Modi’s previous visit to the U.S., key sticking points—particularly involving India’s agriculture and dairy sectors—remain unresolved. A sixth round of talks is scheduled for late August, when a U.S. delegation is expected to visit New Delhi. Indian officials, speaking to Reuters, expressed hope that any tariff measures imposed by the U.S. would be temporary, assuming progress is made in finalizing the trade pact by the fall.
If implemented, these tariffs could significantly affect India’s exports to the U.S., especially in key sectors like textiles, auto parts, and pharmaceuticals. The additional penalty linked to defense and energy imports from Russia further complicates the geopolitical balance India seeks to maintain amid the ongoing Russia-Ukraine conflict. India has so far resisted pressure to scale down its strategic and energy ties with Russia, citing national interest and the need to maintain diplomatic independence.
