August 28, 2025
NEW DELHI – US President Donald Trump’s 50% tariffs on Indian goods come into effect today, marking one of the steepest trade measures against any American partner.
Earlier this month, Trump announced the punitive tariffs in response to New Delhi’s continued purchase of Russian oil. The new levies raise duties to 50% on a wide range of Indian exports.
On August1, 2025, Trump’s administration initiated a 25% “reciprocal” tariff on Indian imports, aimed at addressing trade imbalances and stalled negotiations. While, on August 6, 2025, an additional 25% tariff was imposed as a punitive measure over India’s continued purchase of Russian oil, raising the cumulative tariff level to 50%.
On Monday, the US Department of Homeland Security issued a draft notice confirming the implementation timeline. It stated that the tariffs will apply to Indian goods “entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 AM Eastern Daylight Time on August 27, 2025.”
The move is set to hit Indian merchandise exports worth an estimated ₹4,00,060 crore.
Prime Minister Narendra Modi has vowed to deal with the economic blow by promising tax cuts and pushing for greater domestic self-reliance to offset the impact of the tariffs.
President Trump repeatedly labelled India the “tariff king” and accused it of being a “big abuser” of trade—citing India’s trade-weighted average tariff of around 12%, compared to the U.S. rate of 2.2%
PM Modi reportedly ignored Trump’s calls amid Tariff standoff
Prime Minister Narendra Modi has allegedly refused to take four phone calls from President Trump in recent weeks, according to a report by German daily Frankfurter Allgemeine Zeitung (FAZ). Citing sources, the paper said PM Modi’s silence reflected both the “depth of his anger” and a measure of caution in handling the ongoing tariff dispute.
Japanese outlet Nikkei Asia echoed the claim, reporting that PM Modi was deliberately avoiding Trump’s calls—further fueling the American President’s frustration.
Rajya Sabha MP Harsh Vardhan Shringla expresses hope for successful FTA with the US
Former Foreign Secretary and Rajya Sabha MP Harsh Vardhan Shringla remains hopeful that India will be able to conclude a “satisfactory mutually beneficial” Free Trade Agreement (FTA) with the US as 50 per cent tariffs kick in on Wednesday, highlighting the “close and special partnership” between Prime Minister Narendra Modi and Donald Trump.
Contrary to certain reports suggesting that the former FS indicated a Free Trade Agreement would happen soon, he actually expressed that he was hopeful about the possibility. This distinction provides important context about how the Modi-Trump relationship could potentially pave a pathway for future trade cooperation, rather than suggesting any imminent certainty.
Referring to the “Howdy Modi and Namaste Trump” events that emphasised on friendship between the two leaders, Shringla highlighted that the “connection” was developed from the first term of US President Trump.
The Former Foreign Secretary said, “One thing that I know is that President Donald Trump and Prime Minister Modi enjoy a very close and special partnership. It’s been evident in many of the meetings that I have been present in myself… That connection doesn’t come from today. It comes from President Trump’s first term in office when you had events like Howdy Modi and Namaste Trump.”
“Hopefully, we will find a way to conclude a satisfactory mutually beneficial Free Trade Agreement with the United States early rather than late and that would certainly take us to the next step of the visit of President Trump to India,” Shringla added.
Shringla said that India is constantly working to “minimise” the impact of the tariffs and suggested shifting toward alternative markets, pointing at India’s FTA with UK, Australia and UAE.
“We will be at the receiving end of 50% customs duties for goods exported into the United States from India. We are working on minimising the impact. One way is to find alternative markets. We have Free Trade Agreements with Australia, the UAE, and the UK, we are close to concluding a Free Trade Agreement with the European Union, This means that we can access different markets and we would have the opportunity to divert some of our exports in that direction.” Shringla said.
Shringla expressed confidence in India’s strong relationship with US and emphasised that through the shared valued and principles India will “undoubtedly” see through this tariffs issue.
“I believe in the relationship. We have the most comprehensive, multi-faceted relationship with the United States, the one that we have more than any other country. The strength of that relationship are the values and principles that we share, which will see us through any ups and downs in the relationship. We will undoubtedly see this through as well,” he said.
He acknowledged that the appointment of Sergio Gor as the next US Ambassador to India is a “positive step.”Shringla added that India is constantly developing its capacity in the field of semi-conductor, rare earth minerals through collaboration with other countries.
“We are developing our own capacities, with collaboration with countries like the USA. We are also developing a very strong semiconductor capacity. We are also undertaking a rare earth mission…We envision ourselves growing over the next 20 years…We have to prepare for the next stage and critical and emerging technologies are a very important part of that,” Shringla said.
Trump’s 50 per cent tariffs imposed on Indian goods come into effect today. According to a report by the Global Trade Research Initiative (GTRI), the exports of the labour intensive sectors in the country brace for a collapse of up to 70 per cent as US tariffs take effect.
As per the GTRI report it will impact a large portion of India’s export basket, particularly in sectors generating massive employment.
The report noted that U.S. tariffs will hit 66 per cent of India’s total exports worth USD 86.5 billion, amounting to USD 60.2 billion in goods, which will face duties of 50 per cent or higher.Among the most vulnerable sectors are textiles, gems and jewellery, and shrimp exports. On the other hand, around 30 per cent of exports to the U.S. worth per cent 27.6 billion will remain duty-free, largely dominated by pharmaceuticals, APIs, and electronics.