India has found itself in the crosshairs of US President Donald Trump over the last few days. What does it mean? It means Trump is now seizing every opportunity — press briefings, off-hand remarks to reporters, social media posts — to target the country he once saw as a close ally.
On Wednesday, Trump announced that he is doubling tariffs on India to 50% — among the highest on any country in the world — over New Delhi's move to purchase oil from Russia. Then, he threatened to impose secondary sanctions, signalling that he is no mood to let India off the hook until he manages to arm-twist the country into giving him what he wants.
While Trump's bitter tirade has caused concerns in New Delhi, it is not a bolt out of the blue. It's just Trump's high-pressure negotiation style combined with a bruised ego. And it certainly doesn't mean that there is no silver lining for India. So, here's a quick look at what the tariffs actually mean and what they definitely do not:
What Do Trump Tariffs Mean
1. Trump is not afraid to apply maximum pressure on India
The US President is clear that he will continue to exert pressure on India in pursuit of his goals on Russia and trade. He doubled India's tariffs within a week of announcing 25% duties. He has already threatened to raise tariffs on pharmaceutical imports to 250%. He is not even flinching from straight up criticising India. Notably, the President has stopped no longer prefacing (sugarcoating) his criticism with phrases like "Modi is my friend but ...". It's clear that Trump is ready to deploy every tool in his arsenal to extract concessions. It's part of his playbook.
Also Read: US media reacts to Trump's 'onslaught' against India: ‘Biggest gamble yet’
2. India won't bend to Trump's will
India has made it clear it won't yield to pressure from Trump. A day after Trump raised tariffs to 50%, Prime Minister Narendra Modi said India is ready to pay a heavy price to protect the interests of its farmers, livestock rearers and fishermen. It was a direct and unambigious message to Washington. The government has also called out America and the European Union over their trade ties with Russia and selective targeting of India. The signaling is clear: India is a country that has resisted pressure from global hegemons throughout its history. Things aren't likely to change now.
3. Trump's frustration has come to the fore
Trump wanted to end the Russia-Ukraine war within 24 hours of coming to power. But that hasn't happened. The US President is now trying to target India's oil imports from Russia to choke Putin and bring him to the negotiating table. Trump has not taken any serious action against China over its import of Russian oil. Especially since China froze the supply of rare earth minerals when US hiked tariffs to 145% a few weeks ago. India seems an easier target.
4. Bilateral ties take a tumble
There’s little doubt that India-US ties have taken a hit in recent days. The slide began when Trump claimed credit for brokering a ceasefire between India and Pakistan — a claim New Delhi promptly rejected, clarifying that the de-escalation was mutual and involved no third-party mediation. Experts suggest Trump may have taken the snub personally, given that he likes to seek recognition for resolving conflicts. Combined with ongoing trade tensions and frustration over the Russia-Ukraine stalemate, it appears the gloves are off and Trump is willing to take a gamble on India ties to meet his goals.
"China has not had its leader have a long conversation with Trump on the phone and essentially dictate to him what’s right and what’s wrong. These are things that happened with India. So, I think that’s why perhaps President Trump would reserve some of his greatest ire on the trade and tariff front for India and for the Indian government. Indeed, it’s a double standard. It’s hypocritical, whatever you want to say" — Michael Kugelman, South Asia analyst, to ANI.
What They Don’t Mean
1. Tariffs are permanent
Not just yet. There is a 21-day window before the full tariff takes effect. This is seen as a last-minute opening for diplomacy. Government sources told CNBC-TV18 that India is trying to negotiate with US to find a solution on the trade agreement. "21 days give space for negotiations to find a way around additional tariffs," sources said, adding that the Centre would try to negotiate a solution.
2. Trump will strong-arm India into submission
That appears unlikely. The Ministry of External Affairs (MEA) has already responded strongly to the tariff escalation, accusing Western powers of hypocrisy for ignoring their own continued business with Russia while singling out India. While India may choose to diversify its energy sources in the future, it is unlikely to do so on Trump's terms.
3. India-US ties are unravelling entirely
No. Despite trade tensions, the broader India-US partnership remains intact. Defence cooperation, technology transfers and joint military exercises continue. A meeting of Quad, a security group that is seen as a counter to China, is scheduled for later this year in New Delhi. The MEA also clarified that security ties between the two countries remain intact. While Trump’s tariff war may slow momentum temporarily, both sides are aware of the bigger picture.
4. Blanket tariffs on all Indian exports
Not exactly. Several key sectors are excluded from the new tariff regime for now. Electronics — including smartphones and semiconductors — as well as pharmaceuticals and IT-related services are largely unaffected. For example, Apple products like iPhones and key pharmaceutical exports will continue under existing exemptions. Though these sectors could be targeted later, there are hopes that India and US may reach a deal before that.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
