On Wednesday, the United States slapped a punishing 50% tariff on a swath of Indian exports, doubling the existing duty as the Trump administration aims to penalize New Delhi for its Russian oil purchases. This move marks one of the steepest tariffs faced by major trading partners in recent memory, underscoring Washington’s strategy to starve Moscow of energy revenue amid the Ukraine conflict.
Who’s Exempt?
While the heavy tariff targets many goods—from textiles to machinery—critical sectors like pharmaceuticals, computer chips, and smartphones remain exempt. These carve-outs come amid ongoing U.S. investigations that could trigger further duties in these high-value industries.
Economic Ripples
India was the United States’ top export destination in 2024, with shipments valued at $87.3 billion. Analysts warn that a 50% duty resembles a trade embargo, threatening smaller exporters and sending shockwaves through global supply chains.
India’s Response
New Delhi has denounced the tariffs as “unfair, unjustified and unreasonable.” In a bid to shield citizens, Prime Minister Narendra Modi pledged to reduce the domestic tax burden and double down on his Make in India and self-reliance initiatives.
Energy and Strategy
Russia accounted for nearly 36% of India’s crude oil imports in 2024, helping stabilize fuel prices at home. Indian Oil, the state-owned refiner, plans to continue Russian purchases depending on the economics, underscoring the clash between market forces and geopolitics.
As trade tensions escalate, businesses and policymakers worldwide are watching closely. Will this tariff standoff reshape global partnerships, or will both sides find a path back to negotiation?
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Trump's punishing 50% tariffs on Indian exports come into effect
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