Donald Trump Imposes 25% Tariff on India, Adds Penalty Over Russia Ties

In a major move that could significantly impact India-US trade relations, US President Donald Trump announced that India will face a 25% tariff on its goods exported to the United States starting August 1, 2025. Along with the tariff, Trump declared that India would also pay an additional penalty for continuing its oil and military purchases from Russia, despite the ongoing Ukraine war.

Trump’s Justification for the Tariff

In a post on Truth Social, Trump explained his decision, stating,

“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.”

He also criticized India for maintaining close defense and energy ties with Russia, noting that India is one of the largest buyers of Russian energy and weapons.

Link to the Ukraine War

India’s continued energy imports and defense deals with Russia indirectly support Moscow’s military operations in Ukraine.

India 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. India will therefore be paying a tariff of 25%, plus a penalty for the above, starting on August first.

This move aligns with warnings issued earlier by NATO chief Mark Rutte and US Senator Lindsey Graham, both of whom had cautioned that countries like India, China, and Brazil could face steep tariffs if they continued trade ties with Russia.

US-India Trade Relations in Focus

• US’s massive trade deficit with India, claiming that India charges far higher tariffs on American goods than vice versa.
• On Air Force One, “India has been a good friend, but India has charged basically more tariffs than almost any other country… You just can’t do that.”
• The tariff announcement followed weeks of speculation, during which Trump had earlier hinted at a 20–25% tariff range.

India’s Response So Far

Earlier this month, Commerce Minister Piyush Goyal clarified India’s Stance that India would not rush into any trade agreement with the US based on deadlines. He asserted that India would only sign a deal that is properly concluded and in the national interest.

Meanwhile, the tariffs come after a temporary 90-day suspension period, granted by Trump in May to allow countries like India to negotiate a trade deal. However, with no agreement finalized, the new tariffs and penalties will now come into effect.

Possible Global Impact

• The tariffs are expected to put pressure on India’s exports to the US, especially in manufacturing, pharmaceuticals, and IT services.
• The penalties may also impact India’s oil imports from Russia, potentially raising energy costs domestically.
• Analysts warn this could strain the otherwise strong India-US strategic partnership, even as both nations describe each other as “friends.”