India Stands Firm as Trump’s 50% Tariffs To Kick In Today, Set to Bite into Exports
A hefty 50% tariff on a wide range of Indian goods, imposed by the United States, officially took effect today, marking a significant escalation in trade tensions between the two strategic partners. The new duties, which kicked in at 9:31 am IST, are set to impact billions of dollars in Indian exports and have been met with a defiant stance from New Delhi, with Prime Minister Narendra Modi vowing that India will withstand the pressure.
The economic fallout for India could be substantial. According to the Global Trade Research Initiative (GTRI), the tariffs could affect Indian exports worth over $60 billion. Labour-intensive sectors such as textiles, gems and jewellery, shrimp, and furniture are expected to be hit the hardest, with some estimates predicting a drop in shipments of up to 70%, potentially affecting millions of jobs. Moody’s Analytics has warned that the “drop in sales to their largest client will hurt,” forcing Indian firms to either lose market share or cut prices, squeezing their profit margins and limiting investment.
The Trump administration has justified the punitive tariffs as a form of “aggressive economic leverage” aimed at pressuring Russia to negotiate an end to the war in Ukraine, a strategy articulated by US Vice President JD Vance. The move penalizes India for its continued purchase of discounted Russian oil. However, the policy has been slammed by New Delhi as “unfair, unjustified, and unreasonable.”
Prime Minister Modi, speaking just days before the deadline, declared that India would not compromise the interests of its farmers and domestic producers. “Pressure on us may increase, but we will bear it all,” he said, reiterating his government’s commitment to finding a way out of the economic pressure and urging a push for ‘swadeshi’ (Made in India) goods. India’s envoy to Moscow has also confirmed that the country will continue to purchase oil from sources offering the “best deal,” signaling that New Delhi will not bow to Washington’s demands on its energy policy.
The trade dispute casts a shadow over the broader strategic relationship, potentially jeopardizing US efforts to draw India closer through initiatives like the Quad security grouping to counter China. The tariffs were imposed after five rounds of intensive negotiations between March and July failed to yield a breakthrough, leading President Trump to impose the additional levies.
