Trump slaps 25% tariff on imports from India ‘plus a penalty' for buying Russian oil, weapons, and ‘obnoxious' trade barriers
India and the U.S. have been negotiating a potential Bilateral Trade Agreement (BTA) since February, when a joint statement by Prime Minister Narendra Modi and Mr. Trump stated that such a deal would be concluded by fall 2025.
No mini-deal
Apart from that comprehensive deal, negotiators from the two countries have also been trying to work out a 'mini-deal' that would walk back the retaliatory tariffs that Mr. Trump announced for India and a number of other countries.
This mini-deal, however, has not yet been finalised. Statements by U.S. Trade Representative Jamieson Greer on Monday (July 28, 2025) also indicated that negotiations with India may extend beyond the August 1 deadline set by Mr. Trump. The U.S. President's statement on Wednesday (July 30, 2025), however, seems to confirm that such a mini-deal will not materialise.
The Hindu has reached out to the Ministry of Commerce and Industry for a comment or response and this report will be updated as and when it is received.
'Strenuous and obnoxious'
'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,' Mr. Trump wrote on the social media platform Truth Social.
'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 [sic],' he added.
This tariff rate is marginally lower than the earlier 26% tariff that Mr. Trump had threatened to levy on imports from India. The additional 'penalty' is now the unknown factor, however, as Mr. Trump did not specify what form it will take.
Retaliatory tariffs
In early April, the U.S. President had imposed retaliatory 'Liberation Day' tariffs on imports from most countries in the world, arguing that these countries imposed much higher tariffs on U.S. goods than the U.S. did on imports from them. Thereafter, he announced a 90-day pause, so as to work out bilateral trade deals with several of these countries.
At the end of the 90-day pause in July, Mr. Trump further extended this window to August 1. During this period, he issued letters to at least 14 countries stating the tariffs that would be imposed on imports from them.
Making deals with Trump
Over the last month, he has also concluded deals with the United Kingdom (U.K.), Indonesia, the Philippines, Japan, and the European Union. The deal with the U.K. will see British car exports to the U.S. attract a 10% tariff, down from the earlier 27.5% and a removal of tariffs on aerospace exports to the U.S.
Indonesia's exports to the U.S. will now attract a 19% tariff under its deal with the U.S., the same as will be charged on U.S. imports from the Philippines. Japan negotiated lower tariffs of 15% for its exports to the U.S., the same as the European Union.
Stand up to the U.S.: Congress
The Congress party took aim at Mr. Modi over the 25% tariff announced by Mr. Trump.
'President Trump has slapped a tariff of 25% plus penalty on imports from India,' said Congress communications secretary and Rajya Sabha MP Jairam Ramesh, in a post on X. 'All that taarif between him and Howdy Modi has meant little.'
Mr. Ramesh also highlighted the U.S. President's repeated claims of stopping Operation Sindoor, his special lunch for the Pakistan Army Chief, and U.S. support for financial packages to Pakistan from the International Monetary Fund (IMF) and the World Bank, saying the Prime Minister apparently hoped his silence on all of these issues would ensure that India would get special treatment at the hands of Mr. Trump.
'Clearly that has NOT happened,' Mr. Ramesh added. 'He should take inspiration from Indira Gandhi and stand up to the US President.'
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