Trump Slaps Extra 25% Tariff on Indian Goods, Total Now 50% Amid Row Over Russian Oil Trade

In a sharp escalation of trade tensions between the United States and India, former U.S. President Donald Trump on August 6, 2025, signed an executive order imposing an additional 25% tariff on Indian imports, taking the total tariff burden to a staggering 50%. This move, Trump said, was a punitive response to India's continued purchase of Russian oil, despite Western sanctions against Moscow over the Ukraine war.

Trump has openly accused India of “profiting from war” by purchasing deeply discounted Russian crude, and in some cases, allegedly reselling it at a premium to other nations. He lashed out in recent interviews, saying India is “not a good trading partner”, and dismissed recent Indian gestures to reduce import tariffs on select U.S. goods as “not good enough.”

With this order, the United States has doubled tariffs on a wide range of Indian exports. Products likely to be hit hard include pharmaceuticals, garments, gems and jewelry, and petrochemicals. According to trade estimates, around $64 billion worth of Indian exports to the U.S. could now face higher costs, potentially threatening India’s global price competitiveness in several key sectors.

India’s Response:
The Indian government strongly objected, calling the move “unjustified and unreasonable.” Officials pointed out that both the U.S. and the European Union still maintain various forms of trade with Russia, even as they pressure others to reduce ties. Indian ministries defended their energy policy, arguing that buying Russian oil has helped stabilise global markets, especially when Western nations had earlier encouraged such purchases post the Ukraine conflict.

India insists that its actions are based on economic need and strategic autonomy, and has made it clear that it will not be coerced into altering its foreign policy to suit other powers’ interests.

What the New Tariffs Mean:
The increased tariffs could have a moderate but notable impact on India’s economy. Experts suggest that while exports to the U.S. account for just around 2% of India’s GDP, there could be growth losses of up to 40 basis points, according to analysis referenced by the Reserve Bank of India.

In the U.S., the new tariffs could lead to higher input costs for American businesses that depend on affordable Indian goods, and potentially raise consumer prices. Sectors such as retail, healthcare, and oil refining might see pressure on margins if the price hikes persist.

Escalation Risks and Global Fallout:
Trump hinted that this could just be the beginning, saying tariffs could go “very substantially higher” in the coming days. There are growing concerns that this may turn into a broader trade conflict, not just with India but with other countries buying Russian oil — including China.

Diplomatic experts warn that the decision could lead to a prolonged standoff, pushing India to deepen alternative trade partnerships and rely more heavily on BRICS and non-Western alliances.

As it stands, India-U.S. relations have taken a serious hit, and the road ahead for trade talks appears rough. With Trump’s return to high-profile policymaking, the global trade landscape may be in for renewed turbulence, especially for countries navigating multi-aligned strategies in a divided world.