India reacts to Trump's 25% tariff on exports to US
Trump's decision dashes hopes of a limited trade agreement between the two countries, which had been under negotiation for several months.
Here are some reactions:
MADHAVI ARORA, ECONOMIST, EMKAY GLOBAL
"While the negotiations seem to have broken down, we don't think the trade deal haggling between the two nations is over yet. We see it more from the lens of geopolitics than purely economics and see both sides striving to get the deal done, even as the power equations may change a bit in U.S. favour."
RANEN BANERJEE, PARTNER OF ECONOMIC ADVISORY, PWC INDIA
"Higher tariffs for India compared to countries it competes with, for exports to the U.S., are going to be challenging.
However, the expectation is that the trade deal is likely to be finalised shortly and hence the period of applicability of these higher tariffs could be short."
NILESH SHAH, MD KOTAK MAHINDRA AMC
"Despite the unpredictable policy making of the U.S., the market was expecting a tariff deal to work out as longer-term U.S.-India strategic interests are aligned.
Markets will hope for a 'TACO' trade if better senses prevail.
China is defying U.S./UN sanctions on Iran oil, Myanmar and Russia trade and North Korea support. Size and the competitiveness of the economy has its advantages.
I hope and pray that this unilateral imposition should accelerate Indian policy making to be growth supportive. Our biggest deterrence continues to remain GDP size and competitiveness."
AGNESHWAR SEN, TRADE POLICY LEADER, EY INDIA
"The decision to raise the U.S. tariff to 25% on Indian exports is an unfortunate development, particularly given the strong strategic partnership that has been steadily built between India and the USA in recent years.
However, it's important to note that both countries remain positively engaged in active negotiations with the U.S. team expected in India later in August to finalize a comprehensive trade agreement."
KIRIT BHANSALI, CHAIRMAN, GEM AND JEWELLERY EXPORT PROMOTION COUNCIL INDIA
"This is a deeply concerning development. The Indian gem and jewellery sector, in particular, stands to be severely impacted.
The United States is our single largest market, accounting for over $10 billion in exports - nearly 30% of our industry's total global trade. A blanket tariff of this magnitude will place immense pressure on every part of the value chain.
We recognise the need to address trade imbalances, but such extreme measures undermine decades of economic cooperation. We urge the U.S. administration to reconsider, and call on both governments to engage in constructive dialogue that safeguards bilateral trade and protects the millions of jobs that depend on it on both sides."
N. THIRUKKUMARAN, GENERAL SECRETARY OF TIRUPPUR EXPORTERS' ASSOCIATION
"It is just a negotiation tactic. Trade negotiations are ongoing. The Indian government is tough on certain terms like agriculture and dairy — India isn't opening up.
If it goes through, U.S. exports from the association will be affected, because Vietnam has lower tariffs. We will be losing our competitive edge.
We are optimistic that an imminent trade agreement will be on the lines of the one with the UK. We have to wait and watch, and not panic. There is no reason to panic."
GARIMA KAPOOR, ECONOMIST, INSTITUTIONAL EQUITIES, ELARA SECURITIES, MUMBAI
"Overall, we continue to see a deal by end Q3 but, a kneejerk reaction in Indian asset classes is likely in the near term."
S.C. RALHAN, PRESIDENT OF THE FEDERATION OF INDIAN EXPORT ORGANISATIONS
"This is a major setback for Indian exporters, especially in sectors like textiles, footwear, and furniture, as the 25% tariff will render them uncompetitive in the US market against rivals from Vietnam, China, and elsewhere.
However, we remain hopeful that both countries will work towards a bilateral trade agreement."
AVINASH GORAKSHAKAR, DIRECTOR OF RESEARCH AT PROFITMART SECURITIES
"Until the final document is released, it's all speculation. India is a large, attractive market that the U.S. cannot afford to ignore, so any move will ultimately be weighed against long-term interests. My sense is that the August 1 deadline may itself be flexible and India is unlikely to budge easily.
In the short term, the announcement could trigger some selling pressure, but in the longer term, I expect the impact to neutralize. India's market attractiveness remains intact."
COLIN SHAH, MD, KAMA JEWELRY
"With U.S. being one of the key export destinations, this will severely impact the sectors like gems and jewellery that are heavily dependent on exports.
Going ahead, we expect trade activities to remain muted with U.S. However, we also need to wait and watch how the situation unfolds."
RAHUL MEHTA, CHIEF MENTOR, CLOTHING MANUFACTURERS ASSOCIATION OF INDIA
"Having seen the several about turns on the tariff front in the case of other countries, I would not press panic buttons right now. But, if the proposed terms do come into effect, it will make our products 7% to 10% more expensive than some of our competitors, and it will certainly hurt our apparel exports to the U.S.
Fortunately, this set-back has come at the time when we have just signed an FTA with UK, and are proceeding rapidly with an FTA with EU."
SAKSHI GUPTA, PRINCIPAL ECONOMIST, HDFC BANK, GURUGRAM
"For now, the announcement of 25% tariffs is likely to cause volatility in the FX market with mounting depreciation pressure on the rupee. Although the RBI is likely to intervene tomorrow to tamp down the depreciation pressure."
ADITI NAYAR, CHIEF ECONOMIST, ICRA
"When the U.S. had initially imposed tariffs, we had lowered our forecast of India's GDP expansion to 6.2% for FY2026, presuming a tepid rise in exports and a delay in private capex. The tariff (and penalty) now proposed by the U.S. is higher than what we had anticipated, and is therefore likely to pose a headwind to India's GDP growth. The extent of the downside will depend on the size of the penalties imposed."
ASHOK CHANDAK, PRESIDENT, INDIA ELECTRONICS & SEMICONDUCTOR ASSOCIATION
"The imposition of a 25% tariff by the U.S. on Indian goods will be short term. Indian electronics exports is a short-term challenge that could disrupt supply chains and dent price competitiveness.
India does not have any major advantage compared to other Asian countries anymore if 25% tariff above baseline 10% is continued. However, it also underlines the urgency for India's electronics sector to diversify export markets, deepen domestic markets, develop Indian brands and products, and move up the value chain to reduce dependency on price-sensitive, tariff-exposed exports."
RISHI SHAH, PARTNER AND ECONOMIC ADVISORY SERVICES LEADER, GRANT THORNTON BHARAT
"Given the escalating rhetoric around Russia-Ukraine negotiations, some form of adverse development was anticipated... the specifics of the additional 'penalty' beyond the 25% tariff may determine the actual economic impact."
HARSHA VARDHAN AGARWAL, PRESIDENT, FEDERATION OF INDIAN CHAMBERS OF COMMERCE AND INDUSTRY
"We hope that this imposition of higher tariffs will be a short-term phenomenon and that a permanent trade deal between the two sides will be finalised soon.
The aim is to secure a beneficial pact rather than a hurried deal that gives short term benefit but may result in adverse outcomes in the long term.
It is also important to note that India offers a large market for U.S. businesses and many of the large companies from the U.S. benefit from leveraging the demand as well as the skills and talent pool that we have to offer."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
12 minutes ago
- Yahoo
Texas' proposed congressional map dismantles districts flagged by DOJ
In early July, as President Donald Trump was pushing Texas to redraw its congressional map to better favor Republicans, the Department of Justice sent state leaders a letter. Four of Texas' congressional districts were unconstitutional, the department warned. Three, the 9th, 18th and 33rd, were unconstitutional 'coalition districts,' where Black and Hispanic voters combine to form a majority. The 29th, while majority Hispanic, was also unconstitutional, the letter said, because it was created by its two neighbors being coalition districts. 'It is well-established that so-called 'coalition districts' run afoul of the Voting Rights Act and the Fourteenth Amendment,' assistant attorney general Harmeet Dhillon wrote, threatening legal action if Texas didn't bring the districts into compliance. On Wednesday, Texas House Republicans released their first draft of a redrawn map designed to give the GOP five new seats in next year's midterms. As for the four districts that troubled Dhillon? In the Houston area, the 9th and the 18th districts, where no one race currently constitutes a majority of eligible voters, would be redrawn as just over half Hispanic and half Black, respectively. But as a result, the nearby 29th District — a fixture of east Houston's Latino community — would lose its Hispanic majority, becoming 43% Hispanic, 33% Black and 18% white. The 33rd District in North Texas, although entirely redrawn, would still have no single racial or ethnic group that constitutes a majority. Texas has long maintained that it drew these maps without an eye toward race. But tinkering with the lines now that these racial concerns have been raised risks triggering a Voting Rights Act complaint, legal experts said. States generally cannot redraw districts based on race without a compelling argument that it's necessary to protect voters' ability to elect their candidates of choice, said Justin Levitt, a redistricting expert at Loyola Law School. 'It sure seems like they have actually done what the DOJ, without any basis, accused them of,' Levitt said, noting that he had not done sufficient analysis to say for sure. Legal experts say the DOJ's interpretation of the law around coalition districts, and thus its legal threats to Texas, are based on faulty logic that could be backing the state into a discrimination lawsuit. 'Nothing in this decision suggests, much less holds, that the VRA prohibits the very existence of coalition districts,' Ellen Katz, a redistricting expert at the University of Michigan Law School, told the House redistricting committee at its first hearing last week. 'There are hundreds of these districts nationwide in which jurisdictions relying on traditional principles create these districts.' Coalition districts Section 2 of the Voting Rights Act of 1965 says states cannot engage in election or voting practices that dilute the electoral power of voters of color, including by packing them into a single district or diffusing them throughout multiple. For decades, courts held that states can satisfy the requirements of Section 2 by creating districts where multiple politically cohesive racial voting groups constitute a majority. Currently, Texas has nine districts where no one racial or ethnic group has a majority; in eight of them, Black, Hispanic and Asian voters combined create a majority. In 2024, the 5th U.S. Circuit Court of Appeals, which hears Texas-based cases, reversed a prior ruling and said coalitions of different racial or ethnic groups within one district cannot claim their rights have been violated under Section 2 of the Voting Rights Act. Citing this ruling, Dhillon told Texas that its coalition districts were 'nothing more than vestiges of an unconstitutionally racially based gerrymandering past, which must be abandoned, and must now be corrected by Texas.' But this reflects a misunderstanding of this case, legal experts say. Under this ruling, the Voting Rights Act can't require states to create coalition districts, but that doesn't mean coalition districts are inherently unconstitutional. 'All it says is that you don't have the affirmative obligation to purposely create [a coalition district] at the outset,' said Mark Gaber, a lawyer with the Campaign Legal Center who is representing a group of plaintiffs in an ongoing lawsuit against the current maps. 'It certainly doesn't say, go through the map and eliminate all of the ones you drew.' Texas leaders have contradicted themselves and each other on the question of whether the state has coalition districts and what should be done about them. Gov. Greg Abbott, days after receiving Dhillon's letter, included redistricting on his agenda for the Legislature's special session, citing 'constitutional concerns raised by the U.S. Department of Justice.' He later told Dallas' Fox 4 News that redistricting was necessary because of the 5th Circuit's ruling. 'We want to make sure that we have maps that don't impose coalition districts while at the very same time ensuring that we will maximize the ability of Texans to be able to vote for the candidate of their choice,' he said. At a House committee hearing Friday, GOP Rep. David Spiller of Jacksboro asked Rep. Todd Hunter, who carried the 2021 maps in the lower chamber, whether Texas currently has coalition districts. Hunter said 'the law was different then.' 'You had coalition districts being interpreted differently,' he said. 'Today, you have a 2024 5th Circuit case absolutely changing the law.' But in court, Texas has long argued it has not drawn coalition districts to address racial disparities, because it draws 'race blind' maps. Attorney General Ken Paxton doubled down on this argument in response to the Dhillon letter. 'The Texas Legislature has led the Nation in rejecting race-based decision-making in its redistricting process — it has drawn its current maps in conformance with traditional, non-racial redistricting criteria to ensure Texas continues to adopt policies that will truly Make America Great Again,' Paxton wrote. At the request of Democrats, the House and Senate redistricting committees have invited Dhillon to testify on the letter and her allegations against Texas, but neither she nor any representative from the DOJ has responded to the request. The Senate panel this week voted not to subpoena her. What happened to the Houston DOJ districts Three of the districts Dhillon cited in her letter are neighbors in the Houston area. All three would be radically redrawn by the House's proposed map. The 9th Congressional District is a multiracial district made up of 45% Black voters, 25% Hispanic voters, 18% white voters and 9% Asian voters. The district, which covers parts of southwest Houston and outlying suburbs, voted for Vice President Kamala Harris in 2024 by 44 points, and has reliably reelected Democratic Rep. Al Green since 2004. Under the House's proposed map, the 9th District has been redrawn around an entirely new part of Houston, retaining just 2% of Green's current district and scooping up conservative swaths of east Harris County. The Hispanic population would climb to just over 50% and the white population would almost double to 34%. Black voters would drop to 12% and Asian voters to 2%. In 2024, this new district would have voted for Trump by 15 points. Green, who is essentially drawn out of his district, condemned the proposal as racist, saying 'the DOJ demanded that the race card be played, and the governor dealt the people of Texas a racist hand.' Republicans pointed to the changing preferences of Latino voters, who swung sharply for Trump and other GOP candidates in 2024, to defend these new lines. 'Each of these newly-drawn districts now trend Republican in political performance,' Hunter said. 'it does allow Republican candidates the opportunity to compete in these districts.' Some of Green's existing district has been pushed into the newly drawn 18th Congressional District. While this was previously a seat with no single racial majority, its electorate would become 50.8% Black, while cutting the Hispanic and white populations. It would also tilt even further to the left; Harris carried the district by 40 percentage points in 2024 and would have won it by a 54-point spread under the new lines. Next door, Rep. Sylvia Garcia's 29th Congressional District would also be reconfigured, with Hispanic residents making up 43% of its new eligible voting population — down 20 percentage points from the current makeup. The district's Black and white populations would increase to create a district without a single racial group dominating. It would become more strongly Democratic. In challenging Texas' maps, plaintiffs have contended that Houston's population justifies two majority Hispanic districts. Instead, the one strong majority Hispanic district has been eliminated, and replaced with a district that is almost exactly half Hispanic, alongside one that is almost exactly half Black. '50.5% is unlikely to perform for Latino preferred candidates, or Black preferred candidates,' Gaber said. 'And they know that. It's a mirage.' What happened to the North Texas DOJ district In her letter, Dhillon also said the 33rd Congressional District ran afoul of the Constitution through its coalition status. The district is currently anchored in Fort Worth, with an electorate that is 44% Hispanic, 25% Black, 23% white and 6% Asian. The district went for Harris by 34 percentage points and has consistently reelected Rep. Marc Veasey, a Black Democrat. A decade ago, Texas, and the federal courts, asserted that the 33rd was not a coalition district. 'District 33 is not a 'minority coalition opportunity district' in which two different minority groups 'band together' to form an electoral majority,' the state and plaintiffs said in a joint advisory to the court. A district court judge agreed, saying it was 'not intentionally drawn as a minority coalition district.' The revised 33rd Congressional District maintains about a third of Veasey's old district, moving out of his Fort Worth base. The proposed new lines would reduce the Hispanic and Black population and increase the white population, while maintaining about the same Democratic lean. Just like in the current map, the proposed 33rd district does not have a single racial group that dominates. Legal experts say that is not inherently a problem, despite what the DOJ letter alleged, as long as voters of color have sufficient power to elect their candidate of choice. At a House committee hearing last week, Nina Perales, the vice president of litigation at the Mexican American Legal Defense and Educational Fund, one of the groups suing over Texas' current maps, testified that the Dallas-Fort Worth area, like Houston, should have an additional Hispanic-majority district on top of Veasey's Hispanic-plurality seat. 'In light of the growth of the population over the past two decades, Section 2 of the Voting Rights Act does require the creation of additional districts,' Perales said. 'If the committee and the legislature decides to take up redistricting, it is certainly true that you cannot subtract from the current level of representation that we have.' Few districts in the Dallas-Fort Worth area went without major changes in the new draft map. In the reshaped downtown Dallas district of Rep. Jasmine Crockett, 50.2% of the voting population would be Black, not unlike the two new Houston districts to inch just past the majority threshold. If Hispanic or Black voters were electing their candidate of choice, there is no legal reason to move more voters of one group into the district to hit a perfunctory benchmark of 50%, Levitt said. 'It tells me you're trying really hard to hit a particular target, such that the target itself was the predominant reason for moving people in or out of the district,' Levitt said. 'That's exactly what the courts have said you can't do.' The lineup for The Texas Tribune Festival continues to grow! Be there when all-star leaders, innovators and newsmakers take the stage in downtown Austin, Nov. 13–15. The newest additions include comedian, actor and writer John Mulaney; Dallas mayor Eric Johnson; U.S. Sen. Amy Klobuchar, D-Minnesota; New York Media Editor-at-Large Kara Swisher; and U.S. Rep. Veronica Escobar, D-El Paso. Get your tickets today! TribFest 2025 is presented by JPMorganChase. Solve the daily Crossword
Boston Globe
14 minutes ago
- Boston Globe
Trump says he ordered subs repositioned in rare nuclear threat to Russia
Advertisement Because nuclear submarine movements are among the Pentagon's most closely held tactical maneuvers, it will most likely prove impossible to know if Trump is truly repositioning the submarines or just trying to make a point. But in Trump's sudden and escalating confrontation with Russia over Ukraine, it is the first time he has referenced the US nuclear arsenal, much less threatened to reposition it. Trump said Thursday that he intends to impose new sanctions on Russia over its unwillingness to wind down its war in Ukraine, the latest step in his gradual shift toward a more antagonistic stance toward the Kremlin. Still, such public flexing of nuclear muscles is rare even for Trump, who last made explicit nuclear threats to Kim Jong Un of North Korea early in his first term in 2018. At that time, he said his 'nuclear button' was 'much bigger and more powerful' than Kim's. That exchange ultimately led to a diplomatic opening to Kim, three meetings between the two leaders, and a complete failure of the effort to get the North Korean leader to give up his nuclear arsenal, which is now larger than ever. Advertisement But Russia is a different case, and Trump has often talked about the fearsome power of nuclear weapons, something he contends he learned about from an uncle who was on the faculty of the Massachusetts Institute of Technology. So while Russian President Vladimir Putin has made threats about putting nuclear forces on alert during the opening days of the Ukraine war, and may have been preparing to use a tactical nuclear weapon in fall 2022 against a Ukrainian military base, the US has never responded. Medvedev is a good foil for Trump; he regularly issues threats against the United States but is essentially powerless. Trump has referred to Medvedev's martial-sounding statements several times in the past week. It was not clear what kind of nuclear submarines Trump was referencing. The US has nuclear-powered attack submarines that search for targets, but it also has far larger, nuclear-powered, and nuclear-armed submarines. Those don't need to be repositioned; they can reach targets thousands of miles away. Kingsley Wilson, the Pentagon press secretary, referred all questions about Trump's statement to the White House. This article originally appeared in
San Francisco Chronicle
14 minutes ago
- San Francisco Chronicle
Trump administration cuts $300M in UCLA research funding over antisemitism claims
The Trump administration has suspended more than $300 million in federal research grants to UCLA, citing the university's alleged failure to address antisemitism and discriminatory practices on campus. The move, part of a broader crackdown on elite universities, marks the most severe funding cut in UCLA's history. According to government letters obtained by multiple news outlets, agencies including the National Science Foundation, National Institutes of Health and Department of Energy are halting hundreds of active grants. Officials allege the university engaged in 'race discrimination' and 'illegal affirmative action,' and failed to prevent a hostile climate for Jewish and Israeli students, following campus protests over the Gaza war. Attorney General Pam Bondi said Tuesday that UCLA would 'pay a heavy price' for its 'deliberate indifference' to civil rights complaints. A 10-page letter Tuesday from the Department of Justice to UC President Michael Drake said the DOJ had looked into complaints of discrimination since Oct. 7, 2023, the day Hamas attacked Israel, leading to the Israel-Hamas war in Gaza, which sparked protests at college campuses across the U.S. The letter cited 11 complaints from Jewish or Israeli students regarding discrimination between April 25 and May 1, 2024, while pro-Palestianian protesters occupied an encampment on the UCLA campus. 'Several complainants reported that members of the encampment prevented them from accessing parts of the campus,' the letter said, and some reported encountering intimidation or violence. The Department of Justice set a Sept. 2 deadline for the university to begin negotiations or face legal action. 'Federal research grants are not handouts,' he wrote Thursday. 'Grants lead to medical breakthroughs, economic advancement, improved national security and global competitiveness — these are national priorities.' The freeze affects more than 300 grants, with nearly $180 million already distributed, and follows similar enforcement actions against Harvard, Columbia and Brown universities. UCLA recently agreed to a $6.5 million settlement with Jewish students and a professor over claims of discrimination during 2024 campus protests. Frenk, who is of Jewish heritage, emphasized the university's efforts to combat antisemitism, including the creation of a campus safety office and an initiative to fight antisemitism and anti-Israel bias. 'Antisemitism has no place on our campus, nor does any form of discrimination,' he wrote, while insisting the funding cut 'does nothing to address any alleged discrimination.'
