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*Washington, D.C., August 9, 2025* — In a dramatic escalation of tradetensions, U.S. President Donald Trump has announced that his administrationwill impose *tariffs exceeding 100%* on Indian imports if New Delhi doesnot halt its continued purchase of Russian oil. The announcement camethrough a series of statements and tweets earlier this week, with Trumpaccusing India of undermining U.S. sanctions and damaging American industry.
The new tariff policy is set to begin with a 25% hike, already implementedon August 7, and will be followed by an additional 25% in three weeks.Trump has signaled that even higher duties could be enforced if India failsto align with U.S. expectations. These tariffs, he claims, are a necessarymeasure to correct “grossly unfair” trade practices and to penalize India’snon-compliance with broader geopolitical norms, particularly its growingenergy partnership with Moscow.
Trump also invoked the *International Emergency Economic Powers Act (IEEPA)*to shield his tariff strategy from legal challenge. In a fiery messagedirected at the U.S. judiciary, he warned that attempts to block hiseconomic decisions could lead to a financial catastrophe reminiscent of the1929 Great Depression. “This is 1929 all over again,” Trump wrote, arguingthat strong executive action is needed to prevent economic collapse.
India’s economic response has been immediate and turbulent. The rupee hasfallen sharply, and markets in Mumbai witnessed a significant dip amidfears of reduced exports and rising costs. Analysts expect sectors such aspharmaceuticals, textiles, and auto components to be hardest hit by the newtariffs. With U.S. trade now facing unpredictability, business confidencein India’s export sector has been shaken.
The tariffs also threaten to derail key defense and strategic deals betweenthe two countries. India is one of the largest buyers of U.S. defensetechnology, and ongoing negotiations over fighter jets, missile systems,and cybersecurity cooperation could now face delays or cancellation.Experts warn that the breakdown in trade trust could spill over intomilitary ties, particularly as China continues to expand its influence inthe Indo-Pacific region.
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Indian political leaders have reacted with strong condemnation. AIMIM chiefAsaduddin Owaisi called Trump’s move “a direct attack on India’ssovereignty and economy,” labeling the U.S. president “thebuffoon-in-chief.” Indian officials argue that the U.S. is weaponizingtrade to coerce foreign policy alignment—particularly on the Ukraine-Russiaconflict, where India has maintained a non-aligned, energy-driven position.
Trump’s long-standing critique of India’s trade practices appears to be atthe core of this new offensive. During both his presidencies, he hasdescribed India as a “tariff king,” pointing to India’s 100%+ duties onimported American goods, especially automobiles. In return, Trump haspursued what he calls “reciprocal tariffs,” promising that America will taxothers exactly as they tax the U.S.
This latest move highlights how Trump’s second term has shifted away fromdiplomacy toward a more confrontational economic nationalism. For India,the consequences could be far-reaching—not only in terms of trade anddefense but also in its broader role as a strategic U.S. partner incountering China. With elections approaching in both countries, how thishigh-stakes economic showdown plays out may have lasting globalimplications.