Trump's 25% Tariff on India: Shift from Friendship to Pressure Politics Over Russia Ties and Trade

Former US President Donald Trump has reignited trade tensions by announcing a 25% tariff on Indian goods, effective from August 1. This move comes even as diplomatic negotiations between India and the US continue, with five rounds of trade talks already completed and the next round pending.

While calling India a "friend" in his post on Truth Social, Trump cited several grievances — from India’s close ties with Russia to its high import duties and resistance to American products — as reasons for this steep tariff hike.

Why the Tariff? Trump’s 3 Key Reasons:

India-Russia Relations:
Trump criticized India for continuing arms and oil imports from Russia, especially during the Russia-Ukraine war. He claimed this undermines global efforts to pressure Russia diplomatically and economically.

Restricted Market Access:
Trump alleged that India blocks American agricultural goods, dairy, and GM foods, thus harming US farmers while maintaining a protective trade stance.

Unequal Trade Benefits:
Trump labeled India the "Tariff King" and accused it of extracting benefits without offering reciprocity, claiming this imbalance justifies strong trade retaliation.

What Did Trump Say?

"India is my friend… but they make it hard for US businesses to operate. They buy weapons from Russia, trade in energy with Russia, and impose high tariffs on us."

He also emphasized that India ended the war with Pakistan at his request, touting past diplomatic efforts as achievements while shifting tone toward a hardline trade stance.

The Broader Picture: Trump’s Tariff Diplomacy

Trump’s recent action against India is not isolated. He’s made similar moves globally:

• EU: 15% tariff on all 27 countries

• Vietnam: 20%

• Philippines: 19%

• Japan: 15%

• Brazil: Threatened with 50% tariff

• Myanmar: 40%

• Cambodia: 36%

• Indonesia: 32%

Trump has a history of using tariff threats to pressure countries into making trade concessions — a tactic previously seen with China and Mexico as well.

How Will India Be Affected?

India exports goods worth $87 billion annually to the US. A 25% tariff could have serious implications:

• Pharma sector: A large portion of generic drugs could become costlier and lose competitiveness.

• IT services: Indirect effects on project costings and operations.

• Textiles & electronics: Margins may shrink, making Indian products less attractive to US buyers.

The Indian government has acknowledged the tariff threat and is evaluating its impact. A statement mentioned that India is committed to a “fair, balanced and mutually beneficial” trade agreement with the US and that national interests — including those of farmers and MSMEs — will be safeguarded.

What’s Really Behind This Move?

• Trump’s 2024 election strategy may be driving this move, as he seeks to project strength on foreign policy and trade.

• He’s also keen on undermining India’s neutrality in the Russia-Ukraine war and promoting American defence exports.

• Critics say this reflects Trump’s frustration at failing to resolve the Ukraine crisis — despite past claims that he’d end it in 24 hours.

Bottom Line

While this may seem like an economic blow to India, it is also part of Trump’s broader pattern of trade brinkmanship. Historically, he has used such tariffs more as negotiation tools than final actions. The Indian government will likely respond through diplomatic and strategic trade channels, but the announcement clearly adds pressure on the India-Russia relationship — a core concern for the US.