Trump’s 50% tariff on imports from India takes effect

Trump’s tariff on most US imports went into effect on Wednesday, which is expected to impact trade – from pharmaceutical products and precious stones to textiles and machinery – worth billions of dollars and risk thousands of jobs in the world’s most populous nation.

The move is part of a trade framework that the US president began in April by announcing a package of tariffs against dozens of countries.

Half of the US tariffs imposed on India have been described as a ‘punishment’ for its purchase of Russian oil. However, Treasury Secretary Scott Bessent argued that the elevated rates also reflect frustration over the drawn-out negotiations surrounding a trade agreement.

Describing the India-US relationship as “very complicated”, in an interview with Fox Business, Bessent stressed that “India is the world’s largest democracy and the US is the world’s largest economy, and I think at the end of the day, we will come together.”

The 50% tariff rate accelerated in recent weeks, with Trump initially announcing a 25% on Indian goods in July and then declaring another 25% on August 27 due to continued oil purchases from Russia.

The US president has for years called India the “tariff king” and accused New Delhi of protecting its domestic market with levies and strict policies that had previously affected exports of some American goods.

New Delhi’s efforts to persuade Washington to increase its purchases of US energy and defense equipment, including a 70 percent increase in US energy imports to $6.6 billion in the first half of 2025, failed to deter Trump’s tariff decision.

The development also threatens to shake a relationship that has been built over more than 25 years of active diplomacy and a large presence of American companies in India.

India is now one of a few countries, along with Brazil, to face a 50% tariff, which is higher than most of its Asian rivals. However, the Indian government is pushing a ‘Swadeshi’ (domestic) drive to reduce the economy’s reliance on exports, with Prime Minister Narendra Modi on Tuesday calling on Indians to be “vocal for local” and buy Indian goods.