US-India Tariff Timeline: From ‘tariff king' to ‘dead economy' — How it all fell apart
"I'm so thrilled to be here in Texas with one of America's greatest, most devoted and most loyal friends," Trump declared. Modi returned the warmth, calling Trump a 'true friend in the White House'.
Fast-forward to August 2025 — that bonhomie has collapsed. A full-blown trade war is now underway, with India facing a staggering 50% tariff on its exports to the US. What happened in between tells a story of shifting priorities, escalating trade disputes, and a friendship that couldn't survive realpolitik.
The cracks began to show long before the Houston event. In early 2018, Donald Trump publicly slammed India's high import tariffs on Harley-Davidson motorcycles, labelling them 'unfair'. India, he noted, was charging up to 100% tariffs on imported bikes, while the US taxed Indian motorcycles at zero.
By March, India was hit with 25% tariffs on steel and 10% on aluminium as part of Trump's broader 'America First' trade agenda. It was a shot across the bow — one that would set the tone for future economic skirmishes.
Just months before 'Howdy Modi,' Trump announced the end of India's Generalised System of Preferences (GSP) status, a trade concession that had allowed duty-free exports of over $5 billion worth of Indian goods.
Barely weeks after sharing the stage in Houston, Trump labelled India the 'Tariff King', accusing the country of some of the world's highest duties. The phrase would go on to define Trump's view of Indian trade policy for years to come.
Despite these jabs, public displays of friendship continued between the two leaders — but behind closed doors, tensions were mounting.
Following Modi's high-profile visit to Washington in early 2025, optimism briefly returned. Both sides floated the idea of a comprehensive trade deal, with hopes of doubling bilateral trade to $500 billion by 2030. Negotiators from both nations began five rounds of intensive talks between March and July.
Indian officials were so confident they briefed media that tariffs could be capped at just 15%.
In a dramatic reversal, Trump scrapped the expected trade pact and instead imposed an additional 25% tariff on Indian goods. His social media post that day read:
'India's tariffs are far too high, among the highest in the world, and they have the most strenuous and obnoxious non-monetary trade barriers of any country.'
The following day, Trump's rhetoric turned sharply hostile.
'I don't care what India does with Russia,' he wrote online. 'They can take their dead economies down together for all I care.'
The comment stung, especially as India remains one of the world's fastest-growing major economies, with GDP growth above 6% even amid global downturns.
As if to twist the knife, Donald Trump simultaneously announced a trade deal with Pakistan, praising its cooperation and even suggesting that Islamabad might someday sell oil to India.
This came on the heels of the terrorist attack in Pahalgam, further souring sentiment in New Delhi.
On 6 August, Trump signed an executive order slapping a further 25% tariff on Indian imports, bringing the total to 50%. India now finds itself among the most heavily tariffed US trading partners in history, surpassing even China during its peak trade war with the US.
From textiles and gems to pharmaceuticals and auto parts, Indian exporters are now staring at a sharply reduced margin — or outright exclusion — from the lucrative American market.
Trade analysts have dubbed it the worst crisis in US-India economic relations in over two decades. What began as a squabble over motorcycles has now escalated into a full-scale economic confrontation.
The fallout raises a critical question: Can the strategic relationship between the world's largest democracies survive such intense economic strain? Or will trade tensions erode decades of partnership?
As the dust settles on Donald Trump's tariff barrage, the answer may determine not just the future of Indian exports — but the broader balance of power across the Indo-Pacific.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
19 minutes ago
- Economic Times
Technology to drive consolidation in broking and asset management: Saurabh Mukherjea
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads , Founder,discusses his views on the AMC space, potential tariffs on India and China, and the impact of technology on broking and asset management. Mukherjea says the Reserve Bank of India's banking regulations favour incumbents. However, broking and asset management are experiencing tech-driven disruption. Zerodha and Groww exemplify this shift. Digitization allows even smaller players to thrive. Technology will drive consolidation in broking and asset management. New AMCs may use fintech to disrupt the space.I would like to say that as a shareholder in my own AMC, I have to be realistic here. Given that some really big boys are entering the AMC space with lots of capital, many billions of dollars, I have a feeling that we are going to see profit margin compression in the years ahead. This is a classic capital cycle playing out where lots of AMCs are coming up and plenty of capital is coming in. So, coming back to our portfolios, we have sold out on our stock market plays, whether it is AMC, wealth management, the infrastructure which is the stock market. So caution is a relevant part of investing and looking at the juicy valuations in that space, we have sold out on the stock market related to the wealth management, asset management related plays in our reading is much of this is negotiation and hardballing of India. The critical negotiation here as you are alluding to is the Putin-Trump negotiation. Clearly to my mind, the American president is putting pressure on Russia by punishing India for buying Russian the Putin-Trump negotiation ends up in something fruitful whether it is Ukraine, whether it is some sort of broader deal between Russia and America. Once that piece is off the table, tariffs will come down. A 20% tariff on India and 30% on China will be a decent outcome. It will give India an advantage vis-à-vis China. It will give China plus one theme a fillip. It will allow America to reduce its dependence on China. So, 20% tariff on India and 30% on China seems to be the steady state that we will end up say four-five months out once the Putin-Trump negotiations reach some logical banking, the RBI does in a way helped the incumbents by blocking new entry. So, AU Finance got the first universal bank license in 10 or 11 years. In 30 years, India has had three new universal banks. But the RBI blocks entry into banking and that in a way makes the job of the incumbents slightly easier. But in broking, in asset management, there is no such blocking of entry and the sweeping up of the broking asset management space on the back of tech disruption of asset management and broking is upon have seen the impact of firms like Zerodha, Groww. The digitisation of broking and asset management is reasonably easy to fathom and even small players like us have not built a single branch and yet we have been able to grow the business reasonably smoothly just by focusing on high net worth the tech broking, tech asset management space, the use of fintech to drive broking and asset management will be a big theme for the next decade. In any such construct, where technology is being used, the big will get bigger and better and therefore, the smaller players, especially the players who do not have technology, will fall behind. We will see consolidation in broking and asset management driven by technology and it will be very interesting to see that the newer entrants into the AMC space will be able to use fintech to disrupt the have not seen much of this interestingly in America and the broking that we saw Robinhood do in America. In a way, Robinhood's counterpart here would be a Zerodha, but in American asset management, we have not seen tech play a disruptive role in consolidating American asset management. It will be interesting to see whether the new-age Indian AMCs are able to do that. But broking seems relatively clear and I think AMCs will also consolidate on the back of fintech.
Scroll.in
21 minutes ago
- Scroll.in
US market regulator says India yet to deliver summons to Gautam Adani in fraud case
The United States Securities and Exchange Commission has told a district court in New York that India is yet to deliver summons to Adani Group Chairperson Gautam Adani and his nephew Sagar Adani in an alleged $265 million bribery and fraud, The News Minute reported on Tuesday. In a status report filed in the Eastern District court on Monday, the US market regulator said that it had asked India's Ministry of Law for help in serving the complaint six months ago, according to The Telegraph. In November, the US Attorney's office for the Eastern District in New York indicted Gautam Adani in a $265 million bribery and fraud case. The US Department of Justice had alleged that executives of the conglomerate participated in a scheme to bribe officials in India for solar energy contracts, then misrepresented the company's anti-bribery practices to investors in the United States. The details of the alleged bribes were concealed to secure financing, the US Department of Justice claimed. The Adani Group has denied the allegations and vowed legal action. In December, Gautam Adani blamed the press for what he described as ' incorrect and reckless reporting' on the matter. In February, the US SEC told the district court in New York that it had asked the Indian government for help in its investigation into the matter. It added that it was trying to serve its complaint to Gautam Adani and Sagar Adani and that it had sought assistance from the Indian law ministry. On Monday, the SEC said that it had sent notices and other documents on the summons directly to the defendants and their counsel, along with a communication about it to the ministry, The News Minute reported. 'The SEC understands that those authorities have not yet effected service,' it said. The US market regulator added that it would continue communicating with New Delhi and 'pursue service of the defendants via the Hague Service Convention'. Rule 5 (a) of the convention says that a central authority of the state can serve a document or shall arrange to have it served by an appropriate agency While the indictment document outlines conspiracy to obstruct justice and violations of the Foreign Corrupt Practices Act, Adani and his executives were not charged with these counts. However, the indictment document names Gautam Adani, Sagar Adani and Cyril Cabanes of Azure Power Global in what it describes as a 'massive bribery scheme'. On November 27, the Adani Group said in a stock exchange filing that Gautam Adani and Sagar Adani had been charged in the US for securities fraud, not bribery. The charges had hurt the group's market value with shares falling by $54 billion at the time. The Union government had said on November 29 that it views the developments relating to the indictments as a legal matter involving private companies, individuals and the US Justice Department. On February 10, US President Donald Trump signed an executive order directing the justice department to pause prosecutions of Americans accused of bribing foreign officials to secure business deals. The order halts enforcement of the Foreign Corrupt Practices Act, a 1977 law, which bars US companies from bribing foreign government officials. Trump has directed US Attorney General Pam Bondi to review actions related to the Act and draft new enforcement guidelines. The decision was viewed as a potential relief for the Adani Group and its chairperson. With the pause in prosecutions under the Act, investigations against them could be delayed or potentially weakened, reports had said.
Hans India
21 minutes ago
- Hans India
US tariffs don't deter India's growth story: S&P
New Delhi: Trump tariffs will not have any impact on India's growth, as it is not a trade-oriented economy, and its sovereign ratings outlook will continue to remain positive, S&P Global Ratings Director YeeFarn Phua said on Wednesday. In May last year, S&P had upgraded the outlook on India's sovereign rating of 'BBB-' to positive, citing robust economic growth. On August 6, US President Donald Trump announced an additional 25 per cent tariff on all Indian imports, on top of an existing 25 per cent duty, taking the total to 50 per cent from August 27. The White House said the measure responds to India's continued purchase of Russian oil. Replying to a query on whether the tariff imposition poses downside risks to the positive outlook on India, YeeFarn said: 'I don't think the tariffs imposed on India will have an impact in terms of economic growth, largely because India is not a very trade-oriented economy. And if you look at India's exposure to the US in terms of exports to GDP, it is just about 2 per cent'.
