Trump Tariff Highlights: Trump claims US in ‘driver’s seat’ after tariff announcements, says ‘now they will do anything for us’

India imposes an average effective tariff of 9.5% on US exports, significantly higher than the 3% tariff the US levies on Indian goods. The United States remains India’s largest export market, accounting for 18% of its total exports—equivalent to 2.2% of India’s GDP in the 2023-24 fiscal year. In 2024, India’s trade surplus with the US reached a record $38 billion, highlighting the critical nature of this economic relationship for Indian exporters.

Industry experts warn that the sectors most vulnerable to US tariff changes include information technology (IT), pharmaceuticals, automobiles, and core manufacturing industries.

According to Ruchi Mukhija of ICICI Securities and ICICIDirect, as quoted by Business Standard, recent shifts in US tariff policies have led to heightened uncertainty, especially in the final three weeks of the quarter. This uncertainty may affect business decision-making and hinder the recovery of discretionary spending. The manufacturing sector—particularly automotive—along with retail and consumer packaged goods (CPG), is expected to face the most significant impact.

America ‘Liberation Day’

On the eve of Trump’s tariff implementation, a report from the Office of the US Trade Representative (USTR) outlined multiple tariff and non-tariff barriers imposed by India on imports. According to the report, India had the highest average Most-Favoured-Nation (MFN) applied tariff rate among major global economies in 2023, standing at 17%—with 13.5% for non-agricultural goods and 39% for agricultural products.

The USTR’s review, which analyzed trade policies in 59 countries, raised concerns over India’s high import duties on farm products, restrictions on imports, foreign direct investment barriers, and regulatory challenges in the insurance sector. It also cited internet shutdowns in India as disruptions to US digital services.

The report comes at a critical time, as India and the US engage in trade negotiations aimed at easing tariff-related tensions and fostering economic cooperation.

India currently imposes a 10% tariff on pharmaceutical imports from the United States, while the US does not charge any tariffs on Indian pharmaceutical imports.

If the US introduces reciprocal tariffs on the pharma sector, analysts predict they would likely be set at 10% on imported medicines. But what would be the impact?

According to Citi, pharmaceutical companies may attempt to pass the tariff hike onto insurers and healthcare providers. However, if the increased costs are not transferred to patients, the burden would need to be shared across the supply chain. The brokerage notes that a complete pass-through of tariffs would be challenging.

If companies are unable to fully offset the tariff costs, those with the highest exposure to the US generic drug market could see a one-time EBITDA (Earnings Before Interest, Tax, Depreciation, and Amortization) decline of 9% to 12%.

Here’s how different Indian pharmaceutical firms might be affected:

Gland Pharma (50% US revenue) may see an 8-10% EBITDA impact, Aurobindo (48%) could face a 12-13% hit, and Dr. Reddy’s (47%) might experience a 10-12% decline. Zydus Life (46%) is projected to take an 8-10% hit, while Lupin (37%) could see a 6-7% impact. Cipla (29%) may suffer a 4-5% drop, Sun Pharma (32%) is expected to see a 2-3% impact, and Torrent Pharma (9%) is likely to have a minimal 1-2% effect.

The data suggests that companies with higher exposure to the US market, such as Aurobindo and Dr. Reddy’s, would be the most affected, while those with lower exposure, like Torrent Pharma, would see a minimal impact.

Italian Prime Minister Giorgia Meloni, who has carefully avoided criticising Trump, warned that the tariffs would severely impact Italian businesses and be unfair to American consumers.

“This is the reason why I remain convinced that we must work to avert a trade war that would benefit neither the United States nor Europe in any way,” she said.

Countries worldwide have retaliated against Trump’s tariffs by imposing their own duties on US goods, heightening fears of a global trade war that could disrupt economies.

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President Donald Trump is set to make a significant policy announcement on Wednesday from the White House Rose Garden as part of his “Make America Wealthy Again” event.

The speech is scheduled to take place at 4:00 PM Eastern Time (ET), which translates to 1:30 AM Indian Standard Time (IST) on April 3.

Viewers can watch the event live through official White House social media platforms, where it will be streamed in real time.

U.S. stock indexes opened sharply lower on Wednesday as investors awaited details of U.S. President Donald Trump’s tariffs to assess their impact on the global economy, corporate earnings and inflation.

The Dow Jones Industrial Average fell 342.35 points, or 0.82%, to 41,647.61, the S&P 500 fell 57.65 points, or 1.00%, to 5,577.02 and the Nasdaq Composite fell 241.23 points, or 1.38%, to 17,208.66.

(With Reuters inputs)

Tariffs are a central part of Trump’s economic vision. He says “tariff” is his favourite word. He argues the taxes will encourage US consumers to buy more American-made goods, boosting the country’s economy and increasing the amount of tax raised.

Trump wants to reduce the gap between the value of goods the US imports and those it exports to other countries.

For example, the US had a trade deficit of $213bn (£165bn) with the European Union (EU) in 2024, something Trump has called “an atrocity”. The US president also said tariffs were intended to force China, Mexico and Canada – the countries first targeted – to do more to stop migrants and drugs reaching the US.

He has refused to rule out the possibility of a recession as a result of his trade policies. US Commerce Secretary Howard Lutnick said tariffs were “worth it” even if they led to an economic downturn.

Several tariffs announced by Trump have subsequently been delayed, amended or scrapped.

Ahead of Trump’s announcement on reciprocal tariffs, UK Finance Minister Rachel Reeves stated that Britain is actively engaging with Washington to secure an exemption from U.S. auto tariffs. She also indicated that the UK could reconsider a credit scheme that indirectly benefits Elon Musk’s Tesla in order to provide stronger support for its domestic automotive industry.

Reeves said Britain should be given a carve-out from any global tariffs because the two countries report trade surpluses with each other due to measurement differences, after U.S. President Donald Trump unveiled his latest move – a 25% tariff on imported vehicles.

Reeves also said the government could review an electric vehicle incentive scheme that has indirectly benefited Tesla, owned by Trump ally Musk. Canada recently froze rebate payments to Tesla.

Asked if Britain could save carmakers such as Jaguar, Land Rover, Rolls Royce and Aston Martin from tariffs she said: “That’s what we’re working on. We’ve got a few more days left of those negotiations before these tariffs are due to come in.”

(With Reuters inputs)

US tariff hikes may slow down the world economy, and oil prices could be lower than forecast for several years as a result of reduced global demand, the Russian central bank said on Wednesday, as reported by Reuters.

Israel and the United States, two close allies, have had a free-trade agreement since 1985 that excludes most American products from Israeli tariffs. On Tuesday, Prime Minister Benjamin Netanyahu of Israel presented the decision to remove all remaining tariffs as a move toward greater trade liberalization.

“Today we canceled all of the customs duties levied on products from the U.S., Israel’s largest trading partner,” Netanyahu said in a post on X, formerly Twitter. “Canceling the customs duties on American goods is an additional step in the policy that my governments have led for a decade in opening up the market to competition.”

The measure needs approval from the finance committee in the country’s Parliament, or Knesset, but is expected to pass, according to Israeli media.

Israel’s government has said it will cancel all remaining tariffs on American imports, in an apparent bid to ensure that it is exempt from a new wave of levies that President Trump is set to announce on Wednesday.

The dollar slipped and other currencies held in tight ranges on Wednesday as traders awaited details of US President Donald Trump’s plans for tariffs, which could upend the global trading system and shake financial markets. The euro last bought $1.0802, while sterling fetched $1.2941, both rising a touch ahead of a White House tariff announcement.

Donald Trump’s proposed tariffs on foreign-made cars could “completely destabilize” the automotive industry and put over 25,000 UK jobs at risk, a think tank has warned, according to a report by The Daily Telegraph.

Institute For Public Policy Research (IPPR) said employees at Jaguar Land Rover and Mini were some of the most exposed to the US president’s 25pc levies that come into effect from today.

The IPPR said Mr Trump’s tariffs on cars and car parts were enough to plunge the government’s growth plans into “jeopardy”. It added that the tariffs would also hit Tata’s £4bn electric vehicle battery gigafactory in Somerset, for which JLR will be a major customer.

The report comes as the world waits for the details of the US president’s “liberation day” tariffs, which he will unveil later in the White House Rose Garden.

The US is the second largest export market after the EU for cars built in the UK. Almost one in five cars made in Britain is exported to the US in trade worth £6.4bn in 2023.

Pranesh Narayanan at the IPPR, said: “Trump’s tariffs have huge potential to completely destabilise the UK car manufacturing industry, affecting tens of thousands of jobs and putting the government’s growth plans at jeopardy.”

SAIL Chairman Amarendu Prakash has warned that the U.S. decision to raise tariffs could disrupt global trade dynamics, potentially increasing India’s exposure to steel imports, as reported by CNBC TV 18.

The Trump administration has imposed a 25% tariff on all steel and aluminum imports, along with reciprocal tariffs on key trading partners, including India, effective April 2.

Prakash highlighted that Asia’s steel exports to the U.S. and Europe have traditionally been significant. However, as the new tariffs make such exports less feasible, surplus steel from China, South Korea, and Japan—previously bound for Europe—could be diverted to India, creating new challenges for the domestic steel industry.

Pressured by concerns that impending U.S. reciprocal tariffs could escalate a global trade war and weaken crude demand, oil prices extended losses on Wednesday.

Brent crude futures fell 30 cents, or 0.40%, to $74.19 a barrel by 11:48 GMT, while U.S. West Texas Intermediate (WTI) crude dropped 26 cents, or 0.37%, to $70.94.

The White House confirmed on Tuesday that President Donald Trump will announce new tariffs, but details on their scope and scale remain unclear. Markets fear that Trump’s tariff policies could fuel inflation, slow economic growth, and intensify trade disputes.

“Crude prices have paused last month’s rally, with Brent facing resistance above $75. The focus has now shifted from a sanctions-driven supply squeeze to Trump’s tariff announcement and its potential negative impact on growth and demand,” said Ole Hansen, head of commodity strategy at Saxo Bank, as reported by Reuters.

Amid concerns over the imposition of US reciprocal tariffs, gold prices remained steady at their all-time high of Rs 94,150 per 10 grams in the national capital on Wednesday. On Tuesday, the precious metal with 99.9% purity saw a sharp surge of Rs 2,000—the steepest increase in nearly two months—reaching a new record high. Similarly, gold with 99.5% purity held firm at its lifetime peak of Rs 93,700 per 10 grams.

Markets on edge as Trump’s tariff announcement comes after market close on April 2

As Trump prepares to announce ‘reciprocal tariffs’ against multiple countries, Wall Street signalled losses ahead of Wednesday’s opening bell. Investors braced for the latest round of U.S. tariffs on trading partners, with futures for the S&P 500 dropping 0.6% and the Dow Jones Industrial Average slipping 0.5%. Nasdaq futures, already in correction territory, fell another 0.7%. Nearly every sector in the S&P 500 was in the red, with autos, transportation, industrials, and technology stocks taking the hardest hit, while consumer staples remained the sole bright spot.

US tariffs on pharma: THESE companies could be hit the hardest – All you need to know

Ahead of Trump’s ‘reciprocal tariff’ announcement, India is set to lower import tariffs on electric cars, despite opposition from local automakers who sought a four-year delay. According to government and industry sources cited by Reuters, New Delhi is prioritising a trade deal with the United States, signalling its commitment to strengthening bilateral economic ties.

The automakers are lobbying Prime Minister Narendra Modi‘s government to delay any cut in EV tariffs until 2029, and then phase in a reduction to 30% from as high as roughly 100%, two industry sources and one government official said. However, New Delhi is serious about lowering EV tariffs – which have riled US President Donald Trump and his ally Tesla CEO Elon Musk – and the sector is set to be part of the first tranche of tariff reductions in a planned bilateral trade deal, this government official – and another – said.

“We have protected the auto industry for far too long. We will have to open it up,” the second government official said, adding the plan was to lower tariffs “significantly”, including on EVs.

The White House is weighing several tariff proposals, including setting custom rates for each U.S. trading partner, selectively imposing tariffs on certain countries while exempting others, or implementing a flat rate of up to 20% on all imports.

According to a White House official cited by CNN, Trump is expected to make a final decision just hours before his scheduled announcement at 4 PM ET on Wednesday in the Rose Garden.

Regardless of the choice, the tariffs will take effect “immediately,” White House Press Secretary Karoline Leavitt confirmed on Tuesday. While the logistics of such swift implementation remain uncertain, if enforced, other nations would have little time to negotiate and could quickly respond with retaliatory tariffs.

UK shares retreated on Wednesday as global markets braced for details of US reciprocal tariffs that has fueled concerns about an escalating trade conflict that could hamper economic growth. The blue-chip FTSE 100 fell 0.8% as of 1035 GMT; the midcap FTSE 250 index dropped 0.7%. Both indexes shed most of the gains made in the previous session, reports Reuters.

To mitigate the impact of Trump’s tariffs, Garima Kapoor, Economist and Executive Vice President at Elara Capital, suggested that India’s immediate strategy should be to grant greater market access to American goods and negotiate a trade deal. “In the mid to long term, reducing tariffs and further opening up the economy will be beneficial for India,” she added.

Gaura SenGupta, chief economist at IDFC First Bank explained that increasing crude imports could offer some breathing space to India.

“Tariff differentials is maximum on agriculture products . As per our calculation tariff differentials on agriculture products is 55.6%. It’s likely that India reduces tariffs on this segment which accounts for 4.4% share in total imports from the US. Other segments where tariffs could be reduced are pharma, stones and precious stones, electrical machinery, transport vehicles. India could offer to increase crude oil imports from US which accounts for 31% share in overall imports from US.”

Trump’s reciprocal tariff announcement soon: What are India’s options

Donald Trump is set to deliver a major announcement on Wednesday from the White House Rose Garden during a “Make America Wealthy Again” event. The speech is scheduled for 4:00 PM Eastern Time (ET), which corresponds to 1:30 AM IST on April 3.

The event will be streamed live on the White House’s official social media channels.

The European Union’s response to US President Donald Trump’s plan to impose sweeping new reciprocal tariffs on global trading partners later on Wednesday will happen at the appropriate moment, a EU spokesperson told journalists, as reported by Reuters.