'Will be 1929..Great Depression': US president Trump issues chilling warning over tariffs due to...
Justifying his sweeping tariffs, President Donald Trump asserted it as a catalyst for record-breaking stock market gains and a surge in government revenue. He also warned of catastrophic consequences if courts overturn his policy.
'Tariffs are having a huge positive impact on the Stock Market. Almost every day, new records are set,' Trump wrote in a post on Truth Social. He claimed 'hundreds of billions of dollars' were flowing into US coffers and warned that if a 'Radical Left Court' struck down the measures, 'it would be 1929 all over again, a GREAT DEPRESSION!'
In his message, Trump argued that the tariffs were essential to preserving America's 'wealth, strength, and power,' and that opponents should have challenged them at the outset, not after they had begun delivering economic gains. 'Our Country deserves SUCCESS AND GREATNESS, NOT TURMOIL, FAILURE, AND DISGRACE. GOD BLESS AMERICA!' he declared.
Last week, Trump had announced 25 per cent reciprocal tariffs on India that came into effect from August 7. The US president also signed an executive order slapping an additional 25 per cent levy on India for New Delhi's purchases of Russian oil, bringing the total duties to 50 per cent, among the highest imposed by the US on any country in the world. The additional 25 per cent duty will come into effect after 21 days or August 27.
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Business Standard
8 minutes ago
- Business Standard
'Indian refiners can do without Russian oil, but with trade-offs'
Indian refiners, the world's biggest user of Russian oil, can operate without supplies from Moscow from a technical standpoint, but the shift would involve major economic and strategic trade-offs, analysts said. Russian crude supports high distillate yields - the share of crude converted into fuels like petrol, diesel, and jet fuel through distillation. Replacing Russian crude, which accounts for up to 38 per cent of India's refinery intake, with alternatives will shift yields, resulting in lower middle distillates (diesel and jet fuel) and higher residue outputs, according to global real-time data and analytics provider Kpler. US President Donald Trump last week announced an additional 25 per cent tariff on US imports from India -- raising the overall duty to 50 per cent -- as a penalty for the country's continued imports of Russian oil. Since the steep tariffs are likely to hit the USD 27 billion of non-exempt exports that India does to the US, there has been chatter around stopping or curtailing oil imports from Russia. "Indian refiners can operate without Russian crude from a technical standpoint, but the shift would involve major economic and strategic trade-offs," Kpler said in a report, 'US Tariffs on Indian Imports: Implications for Energy Markets & Trade Flows'. India turned to purchasing Russian oil sold at a discount after Western countries imposed sanctions on Moscow and shunned its supplies over its invasion of Ukraine in February 2022. Consequently, from a mere 1.7 per cent share in total oil imports in 2019-20 (FY20), Russia's share increased to 35.1 per cent in FY25, and it is now the biggest oil supplier to India. In terms of volume, India imported 88 million tonnes from Russia in FY25, out of the total shipment of 245 million tonnes. In July, India received 1.6 million barrels per day of crude from Russia, ahead of China's nearly 1 million bpd and Turkey's around 5,00,000 bpd. Kpler said deep discounts and strong compatibility with India's refining systems led to a surge in imports of Russian Ural crude oil. "Russian crude supports high distillate yields (diesel and jet fuel) and is ideally suited to India's advanced refining infrastructure. It has enabled both state-owned and private refiners to operate above nameplate capacity while maintaining strong margins. "A reversal of this will result in a mild yield shift (lower middle distillate yields, higher residue yields) and probably a small reduction in primary throughput rates, as margins will no longer command a sizeable premium against regional benchmarks, considering existing discounts on Russian oil," Kpler said. The Indian government has issued diplomatic but firm responses to the US tariffs, emphasising the importance of maintaining energy security. "Should Russian oil become inaccessible, India could face an additional USD 3-5 billion in annual import costs (based on a USD 5 per barrel premium on 1.8 million bpd). If global prices rise further (a scenario in which Russian crude exports are being curtailed, in the absence of sufficient buying interest from India), the financial burden could increase significantly," the report said. This may prompt the government to cap retail fuel prices, which could strain fiscal balances. A spike in the import bill could even lead to a reduction in overall crude purchases. India's limited storage capacity further constrains its ability to manage such disruptions. While Russian flows to India continue under a 'business-as-usual' stance, the escalating US rhetoric has reopened conversations about supply diversification, with some Indian refiners reportedly booking increased volumes of Middle Eastern crude. According to Kpler, replacing 1.8 million barrels per day (bpd) of Russian crude would require a multi-regional approach. The Middle East remains the most viable option operationally, grades such as WTI Midland from the US could contribute 2,00,000-4,00,000 bpd. These (US crude) are lighter and yield less diesel, a disadvantage for India's distillate-heavy demand. Long-haul freight and cost considerations will also restrict scalability, it said. West Africa and Latin America (LatAm) crudes offer moderate potential. "A balanced replacement strategy may involve 60-70 per cent of substitute volumes from the Middle East, with US and African/LatAm crudes serving as tactical fillers. Nevertheless, none match Russian barrels in cost, quality, or reliability (some of the Russia-to-India barrels have already been contracted under term agreements)," it noted. According to Kpler, Indian refiners can technically adapt to the loss of Russian barrels, but with significant economic consequences. "Replacing 1.7-2.0 million bpd of discounted, medium-sour crude would erode refining margins and misalign product yields. Lighter substitutes like WTI or West African grades produce more gasoline and naphtha, reducing diesel output and hurting both domestic and export economics." Even Middle Eastern grades, while closer in quality, are priced tightly to official selling prices (OSP), leaving limited arbitrage opportunities. "In addition to higher feedstock costs, Indian refiners would face elevated freight and credit charges," it said. "The transition is commercially painful, even if technically feasible. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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Business Standard
8 minutes ago
- Business Standard
Shrimp exporters seek govt aid as Trump tariffs threaten $2 bn of exports
The Seafood Export Association of India has approached the ministries of commerce and finance to seek emergency financial support as USD 2 billion worth of shrimp exports to the US face severe disruptions due to increased tariffs imposed by President Donald Trump, a statement said on Sunday. The association has requested a 30 per cent increase in working capital through soft loans, with margins covered by interest subvention and a 240-day moratorium for pre- and post-packaging operations. "Close to USD 2 billion worth of shrimp exports face severe disruptions," Seafood Export Association of India (SEAI) Secretary General K N Raghavan told PTI, adding that Trump last week further increased reciprocal tariffs from 25 per cent to up to 50 per cent. India exported USD 2.8 billion worth of shrimps to the US in 2024 and has shipped USD 500 million worth so far this year. The new duties make Indian seafood significantly less competitive compared to China, Vietnam and Thailand, which face US tariffs of only 20-30 per cent, Raghavan said. He warned that these Asian competitors would likely capture US market share by lowering prices while Indian exporters cannot reroute existing shipments as it would attract additional 40 per cent penalties for contract violations. "The only way is to explore five new markets, but it would take time. For instance, the free trade deal with the UK, although signed, will take time for implementation," Raghavan said. The tariff escalation threatens one of India's largest agricultural export sectors, which employs millions across coastal states and contributes significantly to the country's foreign exchange earnings.
Mint
8 minutes ago
- Mint
Indian stock market: Nifty 50 slides 7% from record high— will Trump's tariffs trigger a 10%+ fall?
Indian stock market: The threat of steep tariffs imposed by US President Donald Trump on Indian imports cannot be overlooked. The 50 per cent tariff on India is higher than that on several of its export rivals—20 per cent for Bangladesh and Vietnam, and 30 per cent for China. Despite assessments that Trump's tariffs will have a manageable impact on the Indian economy and hopes that India will be able to strike a deal with the US in the near future, the fact is that exports from sectors such as gems and jewellery, textiles, and certain food items have come to a grinding halt. The Indian stock market is still uncertain, trying to discount the impact of tariffs. However, more than the tariff itself, the biggest risk for the market is Trump's unpredictability. The Nifty 50 has fallen nearly 4 per cent in the last one month, primarily due to tariff-related concerns. Experts expect the domestic market to remain under pressure in the near term due to Trump's tariffs, elevated valuations and unimpressive earnings. They believe the market may see another 5 per cent fall. "If US tariffs on Indian imports remain at 50 per cent, the Nifty 50 could see a cumulative drop of over 10 per cent from its peak, given the current valuations," said VK Vijayakumar, Chief Investment Strategist, Geojit Investments. "In India, the major concern remains the quality of corporate earnings. Even now, the market is trading at more than 21 times estimated FY26 earnings. With other global markets looking far cheaper, FIIs may continue selling Indian equities," Vijayakumar added. The 50 per cent tariff rate has made exports from India to the US practically unviable, which will significantly impact the domestic economy. According to Bloomberg Economics estimates, the cumulative tariffs could cut exports to the US by 60 per cent and shrink India's GDP by about 1 per cent. Trump's tariffs are expected to stoke inflation in the US in the coming months, which can push the US Federal Reserve to keep interest rates at elevated levels. This could create a situation of slowing growth amid rising inflation or stagflation. Such a condition will affect foreign capital movement in emerging markets like India. The average US tariff is around 18 per cent—ranging from a low of 10 per cent for the UK to as high as 50 per cent for Brazil and India. Experts believe at least 10 per cent of these tariffs will be passed on to consumers, which will raise inflationary pressure. Vijayakumar believes that the US GDP growth rate in 2025 will be a story of two halves. In the first half, particularly after the April 2 'reciprocal tariffs,' there was a huge frontloading of imports into the US, which sharply increased inventories. This pushed GDP growth into respectable territory for the first half. That is unlikely to happen in the second half, Vijayakumar said. Vijayakumar underscored that imports will fall, and whatever imports do take place will be subject to tariffs, which will be passed on to consumers. This will create a double whammy of a slowing economy and rising inflation—commonly known as stagflation. "In such an inflationary environment, Fed Chair Jerome Powell is unlikely to cut interest rates. While the consensus currently points to a 25-basis-point cut in September, this is improbable as incoming data could deteriorate further. A global slowdown, a US slowdown, and higher US inflation are all possible," said Vijayakumar. A global economic slowdown and the return of inflationary pressure could mean the market remains subdued for a longer period. A lot will also depend on how the bond market behaves amid the evolving situation and incoming data. After the April 2 reciprocal tariffs announcement, the US bond yields saw sharp spikes. Many experts saw rising yields as one of the key reasons why Trump announced a 90-day pause on tariffs and agreed to negotiations. It is quite possible that China could sell part of its US bond holdings if it fails to secure a favourable deal with the US before the August 12 deadline. This could impact the US bond market. Experts believe Trump's tariff tantrums may last for a year or so, till the mid-term elections. "In 2026, the US will hold mid-term elections for the House of Representatives and the Senate, and given the sharp fall in Trump's popularity—likely to worsen due to rising inflation—he may lose his majority. If that happens, his ability to impose trade measures freely could be curtailed," said Vijayakumar. Read all market-related news here Read more stories by Nishant Kumar Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
