New Delhi: The United States has formally notified India of additional tariffs on its goods, escalating trade tensions between the two countries. The Trump administration announced on Tuesday that an extra 25 percent duty will be imposed on Indian imports from August 27, raising the total tariff to 50 percent.
The decision, authorized under Executive Order 14329, comes as Washington increases pressure on New Delhi over its continued imports of Russian crude oil. The U.S. maintains that India’s purchases undermine Western sanctions and weaken efforts to isolate Moscow amid the ongoing conflict in Ukraine.
Markets reacted sharply to the announcement. The Indian rupee slid against the U.S. dollar, while equity indices opened lower. The Nifty50 dropped by more than 130 points to around 24,834, and the Sensex fell by over 400 points to 81,188. Analysts warned of further volatility in the coming days as investors assess the full impact of the tariffs.
India’s leadership has responded firmly. Prime Minister Narendra Modi assured support for small entrepreneurs, farmers and local industries, vowing that India would withstand external economic pressure. Foreign Minister S. Jaishankar reiterated that India’s energy policy is guided by national interest, dismissing accusations that the country is funding Russia’s war effort. “If you have a problem, don’t buy it,” he said in reference to U.S. criticism of Russian oil imports.
Commerce Minister Piyush Goyal noted that India was approaching the trade dispute with an open mind but expressed disappointment at the abrupt U.S. decision. Negotiations between the two countries are now effectively stalled, with Washington indicating that talks will not resume until the tariff issue is resolved.
The new duties are expected to hit key Indian export sectors including textiles, electronics, auto components and gems, potentially disrupting supply chains and impacting millions of workers. Meanwhile, U.S. legal experts continue to question whether the president has the authority to impose such sweeping tariffs under the International Emergency Economic Powers Act, with court challenges already underway.
Analysts warn that the escalating tariff war could mark the lowest point in U.S.–India relations in decades, jeopardizing strategic cooperation in defense and regional initiatives. With both nations unwilling to back down, the crisis threatens to deepen in the days ahead.