Trump's 50% Tariffs Spark Trade Tensions, Modi Calls for 'Self-Reliance'

August 27, 2025 | 08:00 pm

TEMPO.CO, Jakarta - The United States has officially imposed 50 percent tariffs connected Indian products, a determination announced by President Donald Trump and enforced starting Wednesday, August 27, 2025. The caller duties travel arsenic Prime Minister Narendra Modi urged citizens to fortify home purchases successful pursuit of “self-reliance.”

The U.S. Department of Homeland Security confirmed plans to rise an further 25 percent import work connected apical of the existing tariffs, bringing the full levy to 50 percent.

Penalty for Oil Imports from Russia

Washington’s latest enactment follows Trump’s determination earlier this period to use a 25 percent tariff connected Indian goods. The added 25 percent is being billed arsenic a punishment for India’s continued imports of discounted crude lipid from Russia.

More than a 3rd of India’s crude lipid imports past twelvemonth came from Russia, a narration criticized by U.S. officials. Trump’s commercialized adviser, Peter Navarro, accused India of “ignoring its relation successful fueling bloodshed successful Ukraine.”

With this move, Indian exporters present look immoderate of the highest import duties imposed nether Trump’s commercialized policies, alongside Brazil, which is besides deed with 50 percent tariffs connected galore of its exports.

Trade negotiations betwixt Washington and New Delhi person meantime stalled, mostly owed to India’s refusal to unfastened its cultivation marketplace to cheaper U.S. imports, a determination Modi says would harm millions of Indian farmers.

Bilateral Trade astatine Risk

The commercialized narration betwixt the U.S. and India was valued astatine US$129 cardinal (Rp2,111 trillion) successful 2024, with the U.S. moving a US$45.7 cardinal (Rp747 trillion) deficit, according to the U.S. Trade Representative’s Office.

Analysts pass the caller tariffs could impact up to US$87 cardinal worthy of Indian exports. The Indian authorities has denounced the duties arsenic “unfair, unjustified, and unreasonable,” estimating that astatine slightest US$48 cardinal successful exports could beryllium straight impacted, threatening jobs and maturation successful the world’s fifth-largest economy.

Impact connected Labor-Intensive Industries

Economist Garima Kapoor of Elara Securities said the hardest-hit sectors would beryllium labor-intensive industries, including textiles, garments, gems and jewelry, maritime exports, definite automotive products, and leather.

“All of these categories … are tiny and mean standard endeavor intensive. So we volition spot an interaction being beauteous terrible successful presumption of employment,” Kapoor told Al Jazeera.

The Global Trade Research Initiative (GTRI), a New Delhi-based probe institution, stated that the tariffs could erase India’s beingness successful the U.S.

“The caller tariff authorities is simply a strategical daze that threatens to hitch retired India’s long-established beingness successful the US, causing unemployment successful export-driven hubs and weakening its relation successful the concern worth chain,” said Ajay Srivastava, laminitis of GTRI and erstwhile Indian commercialized official.

For now, the U.S. has spared definite cardinal sectors specified arsenic pharmaceuticals and electronics from the further duties, though further investigations could pb to much tariffs.

Despite mounting pressure, Modi stressed his authorities would not compromise.

“For me, the interests of farmers, tiny businesses and dairy are topmost. My authorities volition guarantee they aren’t impacted,” helium said during a nationalist rally successful Gujarat.

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