New Delhi | July 31, 2025
Former U.S. President Donald Trump has announced a 25% tariff on all Indian goods entering the United States, effective August 1, 2025. The sudden announcement has triggered concern across India’s export-dependent sectors, particularly textiles, pharmaceuticals, and auto components. Trade analysts estimate a potential loss of over $8 billion if the tariffs are implemented for the full fiscal year.
The decision, linked partly to India’s continued trade relations with Russia, has also caused the Indian rupee to weaken to 84.60 against the U.S. dollar, its lowest level in two months. The BSE Sensex closed down by 427 points. Business lobbies such as the Federation of Indian Export Organisations (FIEO) and the Confederation of Indian Industry (CII) have urged immediate diplomatic engagement to de-escalate tensions.
Opposition leaders have criticized the central government for failing to anticipate the tariff hike and protect Indian trade interests. The Ministry of Commerce is reportedly preparing a formal response and exploring WTO remedies. Small and medium enterprises (SMEs) that depend on U.S. buyers are expected to bear the brunt of the impact.
“This is a wake-up call for India’s export sector to diversify markets and reduce over-dependence on the U.S.,” said economist Rakesh Chawla.