Why Trump is probably abusing India’s tariff playbook
US President Donald Trump and Indian Prime Minister Narendra Modi held a joint press conference on February 13, 2025 at the East Room of the White House in Washington, DC.
Andrew Cabelo-Nonolds | AFP | Getty
India’s stock market Shown a little sign of panic after the United States announced 50% of the rate Secondary restrictions on goods and continuous oil trade with Russia were threatened.
The Benchmark Index for India’s Blue-Chip shares, was down 0.8% till August 7, until 1:50 pm (4:20 AT).
From bureaucrats to businesses, there is a comprehensive unity in India that the latest growth in the United States is only a pressure trick for fast-wide trade discussions. However, Indian Prime Minister Narendra Modi has a thing that is not a day ago: the support of Indian opponents to push back.
India’s largest opposition leader Rahul Gandhi described the Indian Congress leader as a “financial blackmail” for the purchase of Russian oil, and Modi reduced the political room to confess American demands.
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As a result, the concept of Indian negotiations can only be strong, especially in the discussion on the area that directly affects the farmers of the country.
“India will never compromise on the interests of farmers, fishermen and livestock breeders in the country.
Financial influence
In many estimates, the cost of losing trade with the United States is important for India but not weak.
The most pessimistic estimate is from Morgan Stanley. It is said that if all items are subject to 50% duties, the impact of India’s gross domestic production is likely to be about $ 23 billion on the current exchange rate.
On the other hand, the prices of the US milk exports to India’s exports – one of the most controversial issues is that India will cost Rs 1.8 lakh crore ($ 2 billion) alone, SBI Research said. The SBI said that half the burden of the farmers will fall directly at the retail, unless the government has paid the loss.
Indian exports to the United States
| Area | Exported to America in 2024 | India’s exports to the United States |
|---|---|---|
| Electronics | .1 11.1 billion | 14.30% |
| Gems and jewelry | $ 9.9 billion | 12.80% |
| Pharmaceuticals | .1 8.1 billion | 10.40% |
| Different nuclear reactor, parts, machinery | .2 6.2 billion | 8% |
| Sophisticated petroleum products | 8 5.8 billion | 7.50% |
Source: India’s Ministry of Commerce
The industry spokesperson told CNBC-TV18 on Thursday that additional rates could be a disaster for India’s GEM and jewelry companies, while in accordance with the analysts of Morgan Stanley, 25% of the tariffs can be effectively sold to the United States in large numbers today.
Meanwhile, India’s labor-intensive textile industry is expected that the Billion business will go away from India in the next few months due to the rate.
According to Arvind Sanger of Geofire Capital Management in New York, higher duties of the United States will also affect India’s ability to attract direct foreign investment (FDI).
However, the fact that GDP is caused by GDP domestic use due to GDP’s domestic use has increased.
Indian The rupee will be an immediate accidentAccording to Mahesh Patil, Mahesh Patil, who monitors financial properties worth Rs. However, Patil also mentioned that the rupee, which is settled at the lower level against the US dollar, could be somewhat hit on the Indian exporters and the result may appear for more than a few months.
Snapshot of India’s trade with the United States
| Total bilateral trade in 2024 | 2 212.3 billion |
| Commodity | 9129 billion |
| Service trade | .4 83.4 billion |
| American deficit in trade with the United States | .8 45.8 billion |
| American additional in service trade with India | $ 102 million |
Source: The United States trade representative
There are about 40% of India’s trade services with the United States, which is not a issue of discussion because of exporting more services to India than importing the United States. Trump did not pay attention to the call of curb H1-B VisaThis is a way that is most commonly used by Indian citizens – especially in the tech sector – looking for the talent in the United States.
Medium grounds of India
Trump has been planning to visit China’s first visit from 2018 in the wake of the threat of secondary sanctions on India. And near the US angel Steve Vitkofeh, India’s national security adviser Ajit Doval is visiting Russia for the benefit of India through Muttadgiri.
Meanwhile, the Foreign Ministry of India has called us hypocrisy by ignoring its own trade with Russia through the war in Ukraine. This is an accusation. Trump did aside but did not reject?? It is also important to note that Indian companies are in the field of many Russian oils.
Trump’s trade consultant Peter Navaro has alleged that India uses dollars in trade with the United States to pay for Russian oil, however, most of India’s oil trade with Russia is in the United Arab Emirates (UAE) currency, referors told CNBC-TV18.
Is very willing to find a medium ground with the United States than Brazil and China
The government has already reduced the duties on the imports of American motorcycles, Borban, Ethernet switches, synthetic flavoring assignments and fish hydrolyzate. He is also allowed Tesla To build a shop in Mumbai and withdraw the size of the equality on the Internet giants, which are widely known as Google Tax.
In the last six months, India has increased the US oil purchase by 120%. Source The Government of India told the CNBC-TV18, which was one of the primary demands of Trump when Modi visited the White House on February 225.
However, since then, Trump has moved the goalpost from reducing the US trade deficit India as well as Russia in South Asian country.
See and wait?
Trump has said that the purchase of Russian oil in India has now faced 50%rates.
Despite this, New Delhi’s vowel and rhetoric is gentle than the statements from Beijing or Rio de Janeiro, but it also sticks to its red lines. India is eager to use India to find a victory situation 21 days ago, a government official CN1 told CNBC-TV18.
Although the Government of India has finally not indicated any increase, some experts believe that India has some legal options.
Former Indian Ambassador to the World Trade Organization Anjali Prasad said, “We are important to talk to our business partners and contemporaries, who have been hit by similar actions by the United States.”
“When we are together, decide a strategy, some actions will be effectively possible, because there is strength in numbers.”
The fact is that Trump is going to meet Russian President Vladimir Putin In the coming daysIn the meantime, it shows that the priority of the United States is to end the Russian war on Ukraine.
If there is some success in the discussion between Trump, Putin and Ukrainian President Volodimir Zelensky, the purchase of India’s oil from Russia can no longer be a problem.
Instead of crowded with concessions, the encouragement to see and wait for India is there.
The report contributed to the report by the Delhi Bureau chief of the CNBC-TV 18.
Shriram Iyer leads the digital team of CNBC-TV18 as Executive Editor. He has an 18 -year experience in both Indian and global shops, from Indian Express to Royators and Business Insider India.
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