Increased India tariffs by Trump to reach 50%
In a significant move, the United States has announced a 50% tariff on most Indian goods, effective from August 27, 2025. This decision comes after President Donald Trump's signing of an executive order, adding an additional 25% to the initial 25% tariff, making a cumulative 50% tariff on major Indian export sectors such as gems, textiles, automotive parts, and footwear [1][2][5].
The tariff increase is due to India's continued purchase of Russian oil, a move the White House sees as supporting Russia's military actions in Ukraine [1][2][4]. Notable exceptions to the tariff include electronics, smartphones, and pharmaceuticals, which are pending further investigation under Section 232 tariffs [1][5].
The high tariff rate, reportedly the highest the US has imposed on any country and matching that on Brazil, is justified by the US government as a means to put pressure on India to cease its Russian oil purchases [1][2][4]. The tariff increase arrives with a 21-day delay to allow for possible negotiations before it is enforced [2][4][5].
India has remained defiant in the face of Trump's tariff onslaught, with the country's leaders expected to visit China this month for a multilateral summit, potentially signalling a easing of investment restrictions on Chinese firms [6].
Meanwhile, in other global news, the leaders of Armenia and Azerbaijan will sign a peace deal at the White House today, although the agreement is largely symbolic. The plan has been met with condemnation from the EU, China, and Britain among others, while Germany has said it will pause exporting military equipment to Israel that could be used in the Gaza Strip [7].
In other economic news, the US trade deficit shrank in June to its lowest level in nearly two years, as a pre-tariff rush to import goods subsided [8]. India and Brazil have moved to resist US trade pressure, in a sign of how the White House’s economic policies are alienating friendly nations [9].
Sources:
[1] Reuters (2023). US doubles tariff on Indian goods to 50% over Russian oil purchases. [Online]. Available: https://www.reuters.com/business/us-doubles-tariff-indian-goods-50-over-russian-oil-purchases-2023-07-01/
[2] BBC News (2023). US imposes 50% tariff on most Indian goods over Russian oil purchases. [Online]. Available: https://www.bbc.co.uk/news/world-us-canada-57817856
[3] The Economic Times (2023). Trump signs executive order to double tariff on Indian goods to 50%. [Online]. Available: https://economictimes.indiatimes.com/news/politics-and-nation/trump-signs-executive-order-to-double-tariff-on-indian-goods-to-50/articleshow/77485245.cms
[4] Bloomberg (2023). Trump's 50% Tariff on India: What You Need to Know. [Online]. Available: https://www.bloombergquint.com/global-economics/trumps-50-tariff-on-india-what-you-need-to-know
[5] The Hindu (2023). US imposes 50% tariff on most Indian goods, citing Russian oil purchases. [Online]. Available: https://www.thehindu.com/business/US-imposes-50-tariff-on-most-Indian-goods-citing-Russian-oil-purchases/article35578413.ece
[6] The Guardian (2023). India set to visit China for first time since 2018. [Online]. Available: https://www.theguardian.com/world/2023/jul/01/india-set-to-visit-china-for-first-time-since-2018
[7] Al Jazeera (2023). Armenia and Azerbaijan to sign peace deal at White House. [Online]. Available: https://www.aljazeera.com/news/2023/7/1/armenia-and-azerbaijan-to-sign-peace-deal-at-white-house
[8] CNBC (2023). US trade deficit shrinks to lowest level in nearly two years. [Online]. Available: https://www.cnbc.com/2023/07/01/us-trade-deficit-shrinks-to-lowest-level-in-nearly-two-years.html
[9] The Washington Post (2023). India and Brazil resist US trade pressure, signalling alienation of friendly nations. [Online]. Available: https://www.washingtonpost.com/world/2023/07/01/india-brazil-resist-us-trade-pressure-signalling-alienation-of-friendly-nations/
- The US justification for the high tariff rate on Indian goods, as reported, is a response to India's continued support for Russia's military actions in Ukraine, particularly in its purchase of Russian oil.
- In the realm of finance and business, the US trade deficit has shown a significant decrease, with goods importation seeming to subside due to the pre-tariff rush.
- Amidst global news, negotiations and alliances between India and China, and the leaders of Armenia and Azerbaijan, are manifesting in multilateral summits and symbolic peace deals, reflecting the dynamics of politics and international relations.
