- News
- Business News
- India Business News
- Donald Trump Tariffs News Highlights: US unleashes revised global tariffs- Trade deficit, security cited in executive order; 68 countries, 27-member EU face hikes
Donald Trump Tariffs News Highlights: US unleashes revised global tariffs- Trade deficit, security cited in executive order; 68 countries, 27-member EU face hikes
He has imposed a 25% tariff on India with an additional unspecified penalty for India’s trade with Russia for defence equipment and crude oil. According to White House economic adviser, Trump is frustrated with the lack of progress on trade deal talks with India. He said that Trump sees the 25% tariff and penalty as a ‘remedy’ to help finalise a trade deal. Donald Trump administration officials have also said that India's purchase of Russian oil is an 'irritant' in India-US ties.
How do these new tariffs impact India, which sectors will be hit, and what has been India’s response so far? What tariff rates are other countries facing? Track TOI’s Live coverage on Trump’s tariffs for the latest:
India’s pharmaceutical industry has responded strongly to Trump’s 25% tariff move, saying it will hurt US healthcare more than India. With India supplying nearly half of US generic drugs, experts warn of rising costs and shortages. They say India can pivot to other markets while the US scrambles for alternatives.
Read full storyIndian stock markets recovered from an initial decline on Thursday after US President Donald Trump announced the imposition of a 25% tariff and additional penalties on India. The Nifty50 and BSE Sensex opened with a gap down but rebounded, gaining over 700 points from the day’s lows.
The tariff measures, set to take effect on August 1, position India as Trump’s primary focus in Asia, with the rates significantly higher than those imposed on Vietnam (20%), Indonesia, and the Philippines (19%) each. Market analysts attributed the swift recovery to investor confidence and expectations that the impact on key sectors would be manageable.
Despite the severe tariff announcement, the Indian stock market did not experience a prolonged downturn, reflecting resilience amid geopolitical tensions. The government's response and potential negotiations with the US are likely factors contributing to the market's stabilization.
Read full storyThe Indian electronics sector received a two-week reprieve from the proposed US tariffs, as a crucial category pertaining to technology products remained under review amidst ongoing bilateral discussions, according to govt and industry officials quoted by news agency PTI. US President Donald Trump announced on Wednesday a 25 per cent tariff on Indian imports effective August 1, alongside an additional, unspecified penalty linked to India’s continued purchases of Russian military equipment and oil.
Read full storyDespite India's early engagement in trade talks with Washington after Prime Minister Narendra Modi's crucial White House visit in February, hopes for preferential treatment relative to neighbouring nations appear to have diminished. The current scenario shows Vietnam being subject to 20% tariffs, Indonesia at 19%, and Japan at 15%.
We take a look at sectors with maximum exposure:
At these tariff rates, if the burden of higher tariffs is equally split between Indian producers and US consumers, it could directly shave off 0.3ppt from India's GDP growth. The penalty rate, if levied, would shave off further from growth, and there could be an indirect growth drag as well, led by lower capital inflows, investment.
Another way to interpret today's announcement is to see it as a starting point for renewed negotiation. The Indian government's response on staying committed to the negotiations speak to that.
As per news reports, the US-India trade deal had already reached advanced stages, but for some sticking points such as the US demanding access to sectors such as agriculture, dairy and genetically modified feed, which India was reluctant to give, given its large population dependent on agricultural income.
Then there were some other sticking points such as trade in animal-based oils, and India's non-monetary trade barriers (import bans, licensing requirements, etc), which President Trump referred to as 'strenuous and obnoxious'
Alongside some give-and-take in the sticking points discussed above, resolving the issue around oil purchases could guide the way forward,” says HSBC Global Investment Research.
“Remember, while India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country. Also, they have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of ENERGY, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE — ALL THINGS NOT GOOD! INDIA WILL THEREFORE BE PAYING A TARIFF OF 25%, PLUS A PENALTY FOR THE ABOVE, STARTING ON AUGUST FIRST. THANK YOU FOR YOUR ATTENTION TO THIS MATTER. MAGA!”
"We have just concluded a Deal with the Country of Pakistan, whereby Pakistan and the United States will work together on developing their massive Oil Reserves," he posted on TruthSocial. He even suggested that in future India may buy oil from Pakistan.
"We are in the process of choosing the Oil Company that will lead this Partnership. Who knows, maybe they’ll be selling Oil to India some day!" he added.
India and the US have been engaged in negotiations on concluding a fair, balanced and mutually beneficial bilateral trade agreement over the last few months. We remain committed to that objective.
The Government attaches the utmost importance to protecting and promoting the welfare of our farmers, entrepreneurs, and MSMEs.
The Government will take all steps necessary to secure our national interest, as has been the case with other trade agreements including the latest Comprehensive Economic and Trade Agreement with the UK,” the Ministry of Commerce & Industry read.
Two fundamental aspects merit emphasis. First, in today’s rapidly evolving global scenario, policy positions are rarely final. Second, markets consistently demonstrate remarkable adaptive capacity—even under adverse conditions, economic actors innovate and new equilibria emerge.
Finally, sustaining the growth momentum will ultimately depend on the ability to innovate while deepening economic partnerships across the global landscape. The current situation reinforces the wisdom of our multi-alignment approach in an increasingly multipolar world order,” says Rishi Shah, Partner and Economic Advisory Services Leader, Grant Thornton Bharat.
Nifty50 and BSE Sensex, the Indian equity benchmark indices, sharply dropped in trade after US President Trump announced a 25% tariff plus additional penalty on India. While Nifty50 went below 24,700, BSE Sensex was down 600 points intraday. At 11:01 AM, Nifty50 was trading at 24,725.40, down 130 points or 0.52%. BSE Sensex was at 81,034.50, down 447 points or 0.55%.
Read full storyIt was a "busy day" at the White House on Wednesday as President Donald Trump rolled out a series of key announcements, including a 25% tariff and additional penalties on Indian goods, despite repeatedly calling India and Prime Minister Narendra Modi "friends." At the same time, he offered to assist India's hostile neighbour Pakistan in developing its "massive oil reserves," even suggesting that Pakistan might export oil to India in the future. Later, Trump escalated his tone, remarking that India and Russia could "take their dead economies down together."
Read full storySock market opened at a low with Nifty50 and BSE Sensex, the Indian equity benchmark indices, dropping sharply after US President Trump announced 25% tariff plus additional penalty on India.
Read full storyThe US has sanctioned six Indian companies for allegedly engaging in significant petroleum and petrochemical trade with Iran, in violation of American sanctions.
The firms include Alchemical Solutions, Global Industrial Chemicals, Jupiter Dye Chem, Ramniklal S Gosalia and Company, Persistent Petrochem, and Kanchan Polymers.
Alchemical Solutions faces the largest allegation, with imports of Iranian petrochemical goods worth over $84 million in 2024. The sanctions freeze any US-linked assets and prohibit American entities from conducting business with these firms. The action is part of a broader enforcement against 20 global entities under the US's "maximum pressure" strategy on Iran.
Companies may appeal their designation to the US Treasury’s Office of Foreign Assets Control.
Read full storyUS President Donald Trump criticised India and Russia on Thursday, suggesting that the two nations could "take their dead economies down together." In a post on Truth Social, Trump stated, "I don’t care what India does with Russia. They can take their dead economies down together, for all I care. We have done very little business with India — their tariffs are too high, among the highest in the world. Likewise, Russia and the USA do almost no business together."
Read full storyTrump has attacked India’s economic relations with Russia. “I don’t care what India does with Russia. They can take their dead economies down together, for all I care. We have done very little business with India, their Tariffs are too high, among the highest in the World. Likewise, Russia and the USA do almost no business together. Let’s keep it that way, and tell Medvedev, the failed former President of Russia, who thinks he’s still President, to watch his words. He’s entering very dangerous territory!” he posted on Truth social.
Meanwhile Trump is also sealing trade deals with other countries. A 15% tariff has been announced on South Korea. Deals with Japan, EU, Philippines, Indonesia, and Vietnam have already been announced.
Aditi Raman, Associate Economist, Moody's Analytics
"The US has announced a 25% tariff on Indian exports, down just one percentage point from what was announced in April, plus potential secondary sanctions for importing Russian oil. While the U.S. is India's largest trade partner, the Indian economy is relatively more domestically oriented than most of the region and relies far less on trade. Pharmaceuticals, gems, and textiles are key sectors that are likely to be hit. A point of contention is market access to the key agricultural and dairy sector, which India has historically been reluctant to grant."
