US President Donald Trump has officially announced a 25% tariff on India, starting August 1, 2025, along with an additional penalty.
Trump says the move is justified by what he calls India’s steep tariffs, unfair trade practices, and its ongoing deals with Russia for weapons and energy, despite international pressure to scale back ties with Moscow over the war in Ukraine.
“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,” Donald Trump said in a post on Truth Social.
Trump further mentioned that India bought the majority of military and energy supplies from Russia and China.
“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!,” the US President added.
India-US trade deal still in limbo
The announcement of 25% tariffs led to both sides continuing to engage in serious negotiations to finalize a trade deal.
Indian officials remain cautiously optimistic that a broader trade deal could come together by the fall.
India-US trade deal has some major sticking points as New Delhi has pushed back hard on US demands for greater access to its agriculture and dairy markets, calling those areas politically and economically sensitive.
Washington, meanwhile, wants India to open up more broadly, especially in sectors like autos, EVs, and farm goods, while New Delhi is seeking tariff relief for its labor-heavy exports, including textiles and gems.
Trump’s move signals growing US frustration over what it sees as India’s protectionist tilt, while also raising fresh concerns in Washington over India’s close ties with Russia.
Penalty fueled by Russian ties
The US has taken a hard line on India’s ongoing purchases of Russian oil and military equipment, arguing they effectively funnel money into Moscow’s war machine.
President Trump and senior officials have gone so far as to label the energy imports “blood money,” saying they help prop up Russia’s invasion of Ukraine.
In recent weeks, Washington has floated the idea of steep penalties, including a proposed 500% tariff on countries that continue buying Russian oil.
India wasn’t named directly, but the message was clear.
Commerce Secretary Howard Lutnick has urged India to rethink its longstanding reliance on Russian arms and instead look to US-made defense systems.
For Washington, the goal is twofold: curb Russia’s revenue streams and shrink the sizable trade gap with India by boosting American defense exports.
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