Trump Tariff Live Updates: India-US hold informal talks, no plans to retaliate: Report

Three trading sources involved in oil sales to India said Indian refiners would increase Russian oil purchases in September by 10-20% from August levels, or by 150,000-300,000 barrels per day. Russia has more oil to export next month because planned and unplanned refinery outages have cut its capacity to process crude into fuels. Ukraine has attacked 10 Russian refineries in recent days, taking offline as much as 17% of the country’s refining capacity.

In the first 20 days of August, India imported 1.5 million barrels per day of Russian crude, unchanged from July but slightly below the average of 1.6 million bpd in January-June, according to data from Vortexa analysts.

The volumes are equal to around 1.5% of global supply, making India the largest buyer of seaborne Russian crude, which covers some 40% of India’s oil needs. China and Turkey are also big buyers of Russian oil.

– via Reuters

India’s natural diamond polishing industry is bracing for a 28-30% revenue decline to about $12.5 billion this fiscal, Crisil Ratings said in a report on Thursday.

The fresh blow follows Washington’s decision to levy an additional 25% duty on Indian goods from Wednesday, penalising New Delhi for its continued Russian oil purchases. This comes on top of the 25% reciprocal tariff introduced by President Donald Trump in April.

In FY24, the industry earned roughly $16 billion. The new tariffs threaten to further squeeze the sector, which has already suffered a 40% contraction over the last three years. Crisil attributed the slump to falling diamond prices, weaker demand in key markets such as the US and China and intensifying competition from lab-grown diamonds.

On the US tariffs impact, a Commerce Ministry official said, “It is an understood thing that 50% tariffs are going to impact trade. There will be an impact on the textile, chemicals and machinery sectors in the short run, but it will not be a very long-term loss. The industry is worried; they have been sending representations. The industry has pointed out that in the short run, their orders will face slow down, they will face a liquidity crunch. They will be under financial strain to run their operation. They have been writing to the government to help them meet this liquidity crunch in the short run. Positive work is underway to determine the best way to implement their suggestions. Their suggestions are on the govt’s agenda. We are trying to expedite the rollout of the Export Promotion Mission (EPM) as soon as possible, so that it will give some impetus and support to the industry. We need to create resilient supply chains, whether these are export supply chains or import supply chains. Every challenge or crisis, is a new opportunity. So it’s a wake up call for industry, for governments, everybody, to see how we can diversify our exports…”

As the 50% tariffs imposed by the US come into effect, close to one-fourth of India’s textile exports may be severely impacted in the next six months, with America being the largest export market for the country’s apparel industry and exporters grappling with

order cancellations, experts said on Thursday.

“We are looking at a hit of at least 20-25% for the next six months, if I am considering some amount of re-orientation to be done because otherwise the figure is 28% of exports, largely apparel and made-ups,” Confederation of Indian Textile Industry (CITI) Secretary General Chandrima Chatterjee told PTI.

The government on Thursday extended duty-free import of cotton by three more months till December 31 to support textile exporters facing steep 50% tariffs in the US. Earlier, on August 18, the Finance Ministry had allowed duty exemption on cotton imports from August 19 till September 30.

– via PTI

Commenting on Trump’s 50% tariff impact on India, Motilal Oswal chairman Raamdeo Agrawal told CNBC-TV18 that earnings recovery is the most important trigger for the Indian stock market right now.

He added that his research team doesn’t see any effect on earnings if a deal is reached with US even withing 2 months.

Samajwadi Party chief Akhilesh Yadav on Thursday slammed the BJP-led central government over 50% US tariffs on Indian goods. Yadav took to X and said the government’s failed foreign and economic policies were causing losses for exporters, workers, and artisans. He urged the Centre to provide quick help and relief to small, medium, and micro industries so that the already serious unemployment problem does not get worse.

According to the latest report by CRISIL, India’s natural diamond polishing industry could witness a fall of 20-30% in its revenue, about $12.5 billion this fiscal. This comes after the US imposed heavy 50% tariffs, constituting 25% reciprocal tariffs and 25% as penalty for buying Russian oil.

This setback adds to an earlier decline of nearly 40% over the past three years. The industry has been struggling because diamond prices and sales have gone down, demand in the US and China has weakened, and lab-grown diamonds have become stronger competitors.

Aam Aadmi Party leader Arvind Kejriwal criticised the Union Government on Thursday, saying it has let down Indian cotton farmers under Trump’s tariff pressure. He said the government has removed the 11% duty on cotton imports from the US, which earlier made Indian cotton more competitive in the domestic market. With the duty gone, US cotton is now cheaper by around Rs 15 to Rs 20 per kilo compared to Indian cotton.

Kejriwal warned that most farmers are still unaware of this decision, which was taken quietly, and once its impact is felt, many could face severe financial distress. He called the move a betrayal of farmers, as it risks leaving them with no buyers for their produce.

The government has removed the duty for 40 days, from August 19 to September 30.

Speaking on the 50% tariff on India, imposed by the US Wednesday, Israeli Ambassador to India, Reuven Azar said that he hopes this is a temporary issue which will be resolved. “I think the countries have common interest to continue cooperating.” He further added that it won’t have any impact on India-Israel relationship. “I know that when it comes to the trade between India and Israel, it’s not going to be undermined,” Azar said.

Rajya Sabha MP Kamal Haasan said the 50% tariff imposed by US is a serious challenge to the livelihoods of Indian exporters. He urged both the Centre and state governments to step in with immediate relief.

As emergency measures, he suggested a two-year break on MSME loan repayments and a special emergency credit line. He also called for expanded guarantee covers, restoration of low-interest export credit, faster clearance of pending GST, RODTEP, and RoSCTL refunds, and higher incentives for the most affected export sectors.

Haasan further recommended temporary concessions on power tariffs, freight support to help exporters find new markets, and easier import rules for synthetic yarns. He also pressed for a single-window system to speed up export compliance and refunds.

Former NITI Aayog CEO and ex-G20 Sherpa Amitabh Kant said the latest US tariff measures should act as a wake-up call for India. He pointed out that while the US is holding talks with Russia and China, and even though China is the biggest buyer of Russian oil, it has chosen to target India with tariffs. He stressed that this issue is not about Russian oil, but about India’s energy security and strategic independence, which should not be compromised.

Kant said India should remain firm in protecting its interests and use this challenge as an opportunity to push key reforms. He noted that India has often resisted global pressure in the past and should do the same now. Instead of being discouraged, the country should use the situation to drive bold reforms and expand its export markets for stronger long-term growth.

Tamil Nadu Chief Minister MK Stalin urged the Centre on Thursday to provide urgent relief and long-term reforms to protect industries and workers of the state. He said that the steep 50% US tariff hike has badly affected the Tamil Nadu’s exports, especially Tiruppur’s textile hub, causing trade losses of nearly Rs 3,000 crore and putting thousands of jobs in danger.

Stalin had earlier written to PM Modi on August 16, warning that the steep tariffs could lead to layoffs in export-focused sectors. He requested the Centre to take immediate action, including a special financial relief package for exporters.

At Maruti Suzuki’s annual general meeting today, chairman RC Bhargava said that he hopes the tax rate on small cars will be cut to 18%. He added that reducing car taxes is important, especially now, as high US tariffs are already disrupting several other Indian industries, reported Reuters.

According to Nomura, higher tariffs could hurt India’s economy in three ways:

Drop in export orders: Sectors like textiles, gems and jewellery, household items, and seafood will face a heavy blow from the 50% tariffs, which may work like a trade ban. Smaller MSME units will be hit harder since they don’t have the resources to handle such shocks.

Job losses: Lower export demand could cut jobs in labour-heavy industries such as textiles, apparel, metals, chemicals, gems and jewellery, and leather goods. Together, these sectors employ around 21 million workers directly and through contractors, along with many informal workers who also depend on them.

Weaker business confidence: Tough global trade conditions could further dampen business sentiment, leading to slower private investments.

Reacting to the 50% tariffs on India, Samajwadi Party MP Awadhesh Prasad urged Indians to boycott Pepsi, Coca-Cola, Subway, KFC, or McDonald’s as this wll ensure “chaos in America”. “Inflation will increase in America to the point where Trump himself may have to retract these tariffs… Trump has committed a blunder by turning against India,” he added.

Nomura’s report said after the 50% tariffs have come into effect, around 60% of goods that US buys from India will now face this higher tariff, making the overall effective tariff rate 33.6%.

Pearl Global’s Pallab Banerjee told CNBC TV18 that American buyers are now asking for a 15–20% price cut to offset the tariff impact. Some are also asking for production to be moved to other countries.

He explained that half of Pearl Global’s garment sales rely on the US, and these tariffs could push $6 billion worth of exports away from India, putting lakhs of jobs at risk.

The RBI is expected to hold talks with industry representatives in September to analyse how the 50% US tariffs are affecting the Indian exports. These discussions will take place before the next monetary policy committee review. This is going to be important because the tariffs impact over half of India’s annual exports to the US, worth about $48 billion. Industries like textiles, clothing, gems and jewellery, and marine products, most of which are labour-intensive, are expected to be hit the hardest.

Officials have said that the consultations are being organised due to the uncertain global trade environment caused by new tariffs and shifting trade policies, a PTI report said.

Indian stock markets opened in red on Thursday, a day after 50% tariffs on Indian goods came into effect, hurting investor confidence. Both benchmark indices, Nifty 50 and Sensex, stayed weak in the morning session.

Nifty 50 started the day at 24,695.80, down 16.25 points or 0.07 per cent. Sensex too opened at 80,754.66, slipping 31.88 points or 0.04 per cent.

According to ANI, analysts said that the new tariffs have shaken market sentiment, but upcoming government reforms and policy steps could help steady things in the near future.

The government on Thursday announced that import duty exemption of cotton will continue for another three months, until December 31, to help textile exporters hit by the steep 50% tariffs.

The Finance Ministry had earlier allowed duty-free cotton imports from August 19 to September 30. Now, the exemption has been extended till the end of the year. The decision removes charges such as the 5 per cent Basic Customs Duty (BCD), the 5% Agriculture Infrastructure and Development Cess (AIDC), and the 10% Social Welfare Surcharge on both, which together added up to about 11 per cent duty on cotton imports. Officials said this move will reduce costs for the entire textile chain, including yarn, fabric, garments, and home textiles, giving relief to both manufacturers and consumers, reported PTI.

Speaking in an interview with the Bloomberg, Trump’s trade advisor Peter Navarro said, “Indians are so arrogant about this, they say oh we don’t have higher tariffs, oh it’s our sovereignty, we can buy oil from anyone we want.”

India’s textile and garment exporters are exploring shifting parts of their manufacturing operations overseas to protect their crucial US market following the imposition of steep new tariffs, the Financial Express reported. The additional 50% levy on Indian exports, effective Wednesday, has forced companies to consider moving the final stage of production to Bangladesh, Sri Lanka, Ethiopia, Egypt, Indonesia and Jordan.

Exporters had already shipped out winter consignments to the US, but spring orders which are currently in process, have come under strain. “Some buyers are now demanding additional discounts of 5% to 20% to offset the tariff hike,” Mukesh Kansal, chairman of CTA Apparels, told FE.

Read full story: Textile exporters may shift base abroad to cater to US markets

Tata Steel CEO and Managing Director TV Narendran on Wednesday said the 50 per cent tariff imposed by the US government will not have much impact on the domestic steel sector but the company’s European operations may feel the pinch.

“The US tariff will not have much direct impact on the domestic steel sector as it does not export steel to them, but Tata Steel’s European operation, which exports steel to the US, may feel the pinch as a similar tariff on steel was applicable there too,” he said.

Admitting the challenges such as the prevailing market scenario of the world and the US tariff, he said, “Our growth rate is good and domestic demand increasing. Domestic Steel demand was also growing. But we have to be competitive always.”

Observing that India’s economy stands at a critical juncture, the report said, its strong economic performance over the past few years, along with policy stability and high infrastructure investment, has earned it a sovereign rating upgrade by S&P from ‘BBB-‘ to ‘BBB’.

“This upgrade serves as a testament to the economy’s robust macroeconomic fundamentals and ongoing reform initiatives. The assessment comes at a moment when the economy has exhibited considerable resilience in the face of global challenges, with strong domestic demand and prudent policy management contributing to economic stability,” it said.

On the domestic front, the report said, aided by above-normal precipitation and better sowing of kharif crops, the headline inflation may remain moderate in the near term.

“An increased market arrival in Q1, comfortable buffer stocks and better output prospects, coupled with stable global oil markets, might keep the prices of food grain moderate. The downside risks to global growth are likely to keep international commodity prices in check, partly offsetting the impact of higher tariffs,” it said.

– via PTI

The finance ministry cautioned in its July monthly review released Wednesday that the US tariffs may not have delivered an immediate blow to Indian exports, but their longer-term ripple effects could strain the economy.

The ministry said that ongoing trade talks with Washington “will be crucial” in determining the outlook. India, meanwhile, is pushing a diversified trade strategy, from sealing a deal with Britain and select European nations to advancing negotiations with New Zealand and the European Union, to sustain its “resilient trade performance”.

Still, the review warned these initiatives will take time to bear fruit and may not fully offset potential export losses to the US if high tariff rates continue.

News agency PTI has quoted government sources as saying that there is “no cause for panic” as the 25% additional US trade tariff on India took effect today. The sources further said that the impact is unlikely to be as severe as feared.

“The impact is unlikely to be as severe as feared given the diversified nature of Indian exports”, PTI cited sources as saying. “It is a temporary phase in a long-term relationship,” the sources reportedly said.

On the rupee’s prospects, Bessent dismissed any notion of it emerging as a global reserve currency. The Fox News anchor mockingly asked Bessent, “Do you worry that India will set trade in the rupee and not the dollar?” “There are a lot of things I worry about. The rupee becoming a reserve currency is not one of them,” Bessent responded. He further said that the Indian currency is currently near an “all-time low”.

India maintained steady imports of Russian crude in August, undeterred by growing global scrutiny and Washington’s late-July warning on secondary sanctions. According to data from global analytics firm Kpler, India bought around 1.6 million barrels per day (bpd) of Russian oil this month, almost unchanged from July levels. Notably, the flows are down from the record 2.1 million bpd reached in June. However, Sumit Ritolia, Lead Research Analyst, Refining & Modeling at Kpler, explained, “So far in August, Russian crude imports into India have stayed relatively steady. But that’s less a sign of defiance and more about timing—most of these cargoes were likely locked in weeks earlier, in June or July, well before any policy shifts came into play. If refiners do start to adjust their buying behavior in response to sanctions talk, we probably won’t see it reflected in the data until September or October arrivals.”

Rajya Sabha MP and MNM leader Kamal Haasan took to X and posted a note on American tariff imposition on India. “Trumpets, tariffs, empires – all loud, all temporary. India bows to none,” he wrote in the caption. The letter Haasan posted read, “To my fellow Indians, today, the United States has once again reminded us that in the world of western realpolitik, punishment often masquerades as principle. For centuries, India endured the depredations of empire, but we did not break. Now, tariffs are wielded as the new imperial tool, sanctions in disguise, selectively imposed because we dared to secure our own energy needs instead of genuflecting before a narrow Euro-centric global order…”

Chairman All India Gem & Jewellery Domestic Council Saiyam Mehra said that the India’s FTA with the UK and Australia had positive impact on the gem and jewellery industry and “we are hopeful that in the coming three to six months, we will be able to nullify the effect of the US”.

“I think the Indian gem and jewellery market more or less wasn’t ready so much for it. 25% when it was implied on the gem and jewellery industry, the other 25% we were hopeful that it may not come in, but as of now, more than 1,75,000 workers who are already employed in Surat, Zaveri Bazaar and some places in Calcutta, are also going to be affected by this. However, we as manufacturers and wholesalers have made alternate routes by increasing our marketing throughout all the states in India, in the UAE, Saudi Arabia, Qatar and other markets also which we are looking at. The FTA that has happened between the UK and Australia is having a positive impact on the gem and jewellery industry…however, we are hopeful that good sense will prevail in the US, and Trump takes back the decision…”