Key Highlights:
- India faces 50 percent total tariffs: A 25 percent reciprocal tariff and an additional 25 percent duty for Russian oil purchases.
- Trade talks stalled: US-India trade negotiations remain unresolved, especially over agriculture and dairy.
- Concerns from diaspora and experts: Indian-American leaders warn of price hikes and weakened bilateral ties.
New York: As of August 7, 2025, US President Donald Trump's new reciprocal tariff regime officially came into force. Marking the occasion with late-night posts on Truth Social, Trump declared that “billions of dollars” would start flowing into the United States from countries that, in his view, have long taken economic advantage of America.
The new tariffs, announced under the Executive Order titled ‘Further Modifying The Reciprocal Tariff Rates’, impact nearly 70 countries. Tariff rates range from 10 percent to 40 percent , with India facing one of the harshest penalties—25 percent , immediately effective.
Countries like Japan (15 percent ), the UK (10 percent ), Pakistan (19 percent ), Sri Lanka (20 percent ), Laos and Myanmar (40 percent each) also face significant duties under the sweeping trade measures.
India Slapped with Additional Duties for Russian Oil Purchases
Just a day before the initial tariffs took effect, Trump imposed an additional 25 percent levy on India specifically for its ongoing purchases of Russian oil—bringing the total duties on Indian imports to a staggering 50 percent . This second round of tariffs will go into effect on August 27, giving businesses a short window to prepare.
This marks one of the highest tariffs the US has imposed on any single country in the world under the Trump administration's economic nationalism strategy.
India Reacts Sharply to "Unjustified" Measures
India has strongly objected to the new tariffs, labeling the targeting of its economy as “unjustified and unreasonable.” In a statement, the Indian government affirmed its commitment to taking "all necessary measures" to protect its national interests and economic sovereignty.
The new tariffs come amid already strained trade negotiations between the two countries. Several rounds of talks have failed to yield a bilateral deal, with major sticking points including market access for American agriculture and dairy products.
Indian-American Leaders Express Concern
Prominent voices from the Indian diaspora have expressed concern over the escalating trade tensions. Indiaspora, a nonprofit representing global Indian leaders, emphasized the resilience of US-India ties and urged a return to diplomacy, warning against letting a temporary trade dispute derail a long-standing partnership.
Ajay Bhutoria, a community leader and former Biden advisor, condemned the tariffs, citing their potential impact on everyday Americans. “These tariffs will inflate prescription prices and raise the cost of essentials like spices, lentils, and traditional clothing,” he said, pointing to estimates of apparel and footwear costs rising by up to 37 percent .
Bhutoria also highlighted a perceived double standard, noting that while China received a 90-day tariff pause, India—a democratic ally—was hit immediately.
Outlook Uncertain as Trade Tensions Rise
Despite the setback, leaders and observers remain hopeful that US-India trade discussions can be revived. With a USD 186 billion trade relationship at stake and aspirations of reaching USD 500 billion by 2030, both sides have a strong incentive to find common ground. Until then, businesses and consumers alike brace for higher costs and geopolitical uncertainty.
(With PTI Inputs)
