U.S. President Donald Trump said on Wednesday america will impose a 25 per cent tariff on goods imported from India starting on Aug. 1.
He said India, which has the world’s fifth largest economy, will even face an unspecified penalty on Aug. 1, but didn’t elaborate on the quantity or what it was for.
“While India is our friend, we’ve, over time, done relatively little business with them because their Tariffs are far too high, amongst the best within the World, and so they have essentially the most strenuous and obnoxious non-monetary Trade Barriers of any Country,” Trump wrote in a Truth Social post.
“They’ve at all times bought a overwhelming majority of their military equipment from Russia, and are Russia’s largest buyer of ENERGY, together with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE — ALL THINGS NOT GOOD!”
India’s commerce ministry, which is leading the trade negotiations with america, didn’t immediately reply to a request for comment.
Trump’s decision dashes hopes of a limited trade agreement between the 2 countries, which had been under negotiation for several months.
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U.S. and Indian trade negotiators had held multiple rounds of discussions to resolve contentious issues, particularly over market access for American agricultural and dairy products.
Despite progress in some areas, Indian officials resisted opening the domestic market to imports of wheat, corn, rice and genetically modified soybeans, citing risks to the livelihood of tens of millions of Indian farmers.
The brand new tariffs are expected to affect India’s goods exports to the U.S., estimated at around US$87 billion in 2024, including labor-intensive products corresponding to garments, pharmaceuticals, gems and jeweler, and petrochemicals.
The US currently has a $45.7 billion trade deficit with India.
India now joins a growing list of nations facing higher tariffs under Trump’s “Liberation Day” trade policy, geared toward reshaping U.S. trade relations by demanding greater reciprocity.
The White House had previously warned India about its high average applied tariffs — nearly 39 per cent on agricultural products, with rates climbing to 45 per cent on vegetable oils and around 50 per cent on apples and corn.
The setback comes despite earlier commitments by Prime Minister Narendra Modi and Trump to conclude the primary phase of a trade deal by autumn 2025 and expand bilateral trade to $500 billion by 2030, up from $191 billion in 2024.
U.S. manufacturing exports to India, valued at around $42 billion in 2024, in addition to energy exports corresponding to liquefied natural gas, crude oil, and coal, could also face retaliatory motion if India chooses to reply in kind.
Indian officials have previously indicated that they view the U.S. as a key strategic partner, particularly in counterbalancing China. But they’ve emphasized the necessity to preserve policy space on agriculture, data governance, and state subsidies.
–Reporting by Susan Heavey, Katharine Jackson in Washington, Manoj Kumar and Aftab Ahmed in Latest Delhi; editing by Doina Chiacu and Mark Heinrich