Perhaps everyone saw that coming.
Donald Trump finally dropped the bomb on Wednesday, July 30, imposing a 25 per cent tariff on Indian imports to the US—plus a penalty for buying military equipment and energy from Russia.
PM Narendra Modi may regret ever saying - Trump Sarkar !!
Indian manufacturers across high-growth export sectors are bracing for immediate disruption. “Our main export sectors to the US are pharma, electronics, gems and jewellery and textiles and apparel,” said Rahul Ahluwalia, Founder-Director at the Foundation for Economic Development.
Even though Trump began by calling India "our friend" in his Truth Social post, his close aide Lindsey Graham's warning to BRICS countries a week ago—that the US President intends to crush their economies, including India’s— suggests otherwise.
India’s tariff structure has drawn repeated criticism from Trump, dating back to his first term and even before he took oath for the second, with him calling New Delhi a "very big abuser" when it comes to levying duties on US products.
Even after several rounds of discussion, agriculture remained the biggest bone of contention between the two sides, with India unwilling to open up its farm and dairy sectors to the US— a political self-goal that no ruling party at the Centre is willing to commit to.
It seems PM Modi’s vision of a ‘Viksit Bharat’, hungry for cheap Russian energy to fuel its needs, did not align with Trump’s “Make America Great Again” mantra,
Months later, the idea of MIGA lay in tatters as Trump announced heavy tariffs on India. What piqued interest, however, was his signing off with MAGA—an appeal to his voter base—something he hadn’t done while announcing similar tariffs on countries like South Korea, the Philippines, or Libya.
New Delhi said it would take firm steps to secure the interests of farmers, entrepreneurs, and MSMEs, while continuing to engage in trade negotiations with Washington D.C.
"India and the US have been engaged in negotiations on concluding a fair, balanced and mutually beneficial bilateral trade agreement over the last few months. We remain committed to that objective," New Delhi said in a statement.
"The Government attaches the utmost importance to protecting and promoting the welfare of our farmers, entrepreneurs, and MSMEs.
The Government will take all steps necessary to secure our national interest, as has been the case with other trade agreements including the latest Comprehensive Economic and Trade Agreement with the UK," the statement further read.
India’s tariff structure has drawn repeated criticism from Trump, dating back to his first term and even before he took oath for the second, with him calling New Delhi a "very big abuser" when it comes to levying duties on US products.
Auto and components: Companies like Tata Motors and Bharat Forge anticipate a direct decline in US demand, especially for high-value vehicles and precision parts. Job losses are a looming threat as US orders dip.
Electronics and solar: Contract manufacturers assembling smartphones and solar panels are expected to face severe pricing and volume pressure, particularly since margins were already razor-thin even before the tariff shock.
Jewellery and marine exports: With over $9 billion worth of annual shipments now under the 25% slab, exporters in these sectors must either absorb costs, pass them on, or urgently find new markets.
Textiles and apparel:
The impact is mixed. While Indian players may benefit in low-cost categories if US tariffs on Chinese or Vietnamese competitors remain high, India’s share in high-margin fashion and specialty fabrics could decline.
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