In Short:
– Trump’s 50% tariffs on Indian imports strain U.S.-India relations and threaten India’s economic growth.
– India seeks U.S. tariff reconsideration while exploring trade agreements with other countries to boost exports.

U.S. President Donald Trump’s decision to double tariffs on Indian imports to 50% has taken effect, significantly straining relations between the two countries.

This includes a new 25% tariff related to India’s purchases of Russian oil, adding to an existing tariff that is projected to hinder India’s economic growth.An Indian government source indicated that New Delhi is hoping the U.S. will reconsider the additional tariffs while planning measures to mitigate impacts on trade.

The increased toll on goods such as garments and footwear could threaten thousands of small exporters and jobs, particularly in Prime Minister Narendra Modi’s home state of Gujarat.

India’s current trade agreements with countries like the U.K. and Australia may offer avenues for expanding exports, particularly in textiles.

India’s junior foreign minister, Kirti Vardhan Singh, assured that efforts are underway to protect the economy from the tariff effects, emphasising energy security.

Export Impact

Groups estimate tariffs might impact 55% of India’s merchandise exports to the U.S., disadvantaging Indian exporters against competitors like Vietnam and Bangladesh.

Suggestions include a one-year moratorium on bank loans for affected exporters. Despite challenges, India’s diverse export base and strong domestic demand could cushion the economic blow.