New Delhi: The unprecedented 50 per cent tariffs slapped by the United States on Indian exports were not simply an economic measure but rather a political reaction rooted in former President Donald Trump’s frustration, according to a report by American multinational investment bank Jefferies. The report claims that Trump’s desire to mediate between India and Pakistan in their longstanding conflict was rebuffed by New Delhi, triggering a punitive response that is now reverberating across global trade channels.
According to Jefferies, the duties were “a direct consequence of Trump’s personal pique” after his overtures to act as a peace broker between the two nuclear-armed South Asian nations were rejected. “The tariffs are primarily the outcome of the American president’s dissatisfaction at being denied a role in resolving the acrimony between India and Pakistan,” the report stated. The bank underlined that the White House under Trump repeatedly projected him as a global dealmaker who deserved international recognition for conflict resolution, including a Nobel Peace Prize.
India, however, has consistently held a firm line that its disputes with Pakistan particularly over Kashmir are bilateral issues and that no external mediation is welcome. This stance struck a raw nerve in Washington, where Trump publicly insisted he could “bring a thousand-year-old problem to an end.” In May, during heightened tensions in South Asia, he suggested he would “work with both sides” to find a resolution, remarks that were sharply dismissed by New Delhi.
The Jefferies report went further, pointing to agriculture as a second flashpoint in US-India trade negotiations. Successive Indian governments have refused to allow large-scale imports of agricultural products, shielding nearly 250 million farmers and laborers whose livelihoods depend on the sector. With around 40 per cent of India’s workforce engaged in agriculture, opening the gates to foreign imports is seen as politically untenable in Delhi. This protectionist stance, the report noted, compounded Washington’s frustration.
US Treasury Secretary Scott Bessent added fuel to the fire earlier this month by labeling India “a bit recalcitrant” in trade talks, suggesting that Delhi’s reluctance to compromise was testing Washington’s patience. The sweeping 50 per cent tariffs are now seen as both a negotiating tactic and a retaliatory strike.
India, in its response, described the duties as “unjustified and unreasonable,” signaling that it will not bow to pressure at the cost of national interests. New Delhi also highlighted that the aggressive measures risk undermining broader strategic cooperation at a time when global economic and security alignments are in flux.
The Jefferies report also carried a cautionary note for Washington: alienating India could push it closer to China, a move with long-term geopolitical implications. That concern already appears tangible, as India and China recently agreed to resume direct flights after a five-year hiatus and have stepped up trade dialogues, especially in sectors such as rare earths and electric vehicles.
While the tariffs threaten to dent nearly $48 billion worth of Indian exports to the US, they also mark a turning point in Washington’s approach to Delhi where diplomacy, personal ego, and economic power politics have collided. Whether the Trump-era move will be revisited by future administrations remains uncertain, but analysts agree the fallout could reshape Asia’s strategic equations for years to come.