President Donald Trump has levied a new 25% reciprocal tariff on Indian goods, a measure set to take effect on August 1. This decision is paired with an unspecified penalty for purchases from Russia. Trump’s justification for the tariffs on India is his claim that the country has some of the world’s highest tariffs and the “most strenuous and obnoxious non-monetary Trade Barriers.” He stated that these policies have restricted the amount of business the US can do with India, making the new tariffs a necessary step to level the playing field.
Just a day after the announcement, Trump used his social media platform, Truth Social, to celebrate the success of his tariff policies. He wrote that tariffs were making “America great and rich again” and that the country had successfully countered a long history of being exploited by tariffs from other nations. Trump’s post also contained a celebratory note, declaring that the US had gone from a “dead country” to the “hottest” in the world. This commentary ties the new tariffs directly into his narrative of economic revival through protectionism.
The Indian Ministry of Commerce and Industry has issued a statement in response to the tariffs, adopting a cautious tone. The ministry confirmed that it has “taken note of the announcement” and is “studying its implications.” It also emphasized that both nations have been in talks to create a “fair, balanced, and mutually beneficial bilateral trade agreement,” indicating that India is seeking to resolve the issue through diplomacy rather than immediate retaliation.
The ministry’s statement further highlighted the government’s priority of “protecting and promoting the welfare of our farmers, entrepreneurs, and MSMEs.” This focus on domestic industries suggests that any response from India will be carefully considered to minimize negative impacts on its own economy. The new tariffs represent a significant challenge to the US-India trade relationship, and both nations will now be looking at their next steps with great care.