US President Donald Trump on Wednesday announced a 25% tariff on Indian goods, accusing India of having the “most strenuous and obnoxious non-monetary trade barriers of any country”. Trump on Truth Social wrote, “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.
Trump on India’s trade practices
This is a new escalation in Trump’s longstanding criticism of India’s trade practices. Earlier this week, he said, “India has been a good friend, but it charges more tariffs than almost any other country. But now I’m in charge, and you just can’t do that.” Trump has repeatedly labelled India as the “tariff king” and a “big abuser” of trade relations, targeting what he views as unfair trade imbalances. In April, he had proposed tariffs of up to 26% on Indian imports; however, this was later paused.
The announcement comes at a time when bilateral trade between the US and India had reached a record $190 billion in 2024. While India has taken steps to ease tensions, including cutting duties on American products like Bourbon whiskey and Harley-Davidson motorcycles. Trump and Narendra Modi have previously set an ambitious goal of boosting trade to $500 billion, but this latest tariff decision could put that vision to the test.
What are Trump’s claims about India’s trade approach to the US?
Trump has sharply criticised India for imposing what he calls disproportionately high tariffs and complex non-tariff barriers on American goods. Labelling India’s trade policies as among “the highest in the world” and “obnoxious”, Trump pointed to the country’s intricate regulations and burdensome product testing requirements, which he argues make it exceptionally difficult for foreign companies to compete fairly. Focusing on the US – India trade deficit, approximately $45 billion in goods for 2024. Trump directly linked the imbalance to what he sees as unfair market access and a lack of reciprocity. Earlier this week, while referring to India as a “friend,” Trump made it clear that the US would pursue tough negotiations and would not agree to any deal unless India opens up its markets and reduces restrictions, warning that tariffs remain on the table to secure better terms.
US – India trade imbalance
The trade relationship between the United States and India in 2024 has a notable imbalance. The US imported goods worth approximately $87.4 billion from India, while its exports to India stood at around $41.8 billion. This led to a significant trade deficit of $45.7 billion for the US. Key American imports from India included pharmaceuticals, communications equipment like smartphones, and apparel.