Trump Administration Live Updates: President Announces 25% Tariffs on India as Talks Continue

New York Times

21 hours ago

President Trump announced Wednesday morning that imports from India to the United States would be subject to a 25 percent tariff as of Friday, as he berated the country over trade barriers and its purchases of energy and military equipment from Russia.
The announcement could put pressure on India to strike a deal or face hefty tariffs that would most likely put a strain on economic and diplomatic ties between the countries. It could also encourage businesses to choose other Asian nations for manufacturing operations, blunting India's position as a leading alternative to China.
A 25 percent tariff would be just one percentage point lower than what the president threatened India with on April 2, when he announced plans for sweeping tariffs on dozens of countries. It's also significantly higher than the rates Mr. Trump has settled on for other Asian nations like Indonesia, the Philippines, Vietnam and Japan — all of which have been 20 percent or less.
As companies have moved out of China in recent years, some have made India a base of production, manufacturing electronics, pharmaceuticals and other goods for the U.S. market. An industry analysis shows that, this year, India, which is currently the United States' 12th largest trading partner, is making more smartphones than China or any other country.
'WE HAVE A MASSIVE TRADE DEFICIT WITH INDIA,' Mr. Trump wrote on Truth Social. He followed quickly with another post, saying the United States had done 'relatively little business' with India over the years 'because their Tariffs are far too high. ' Mr. Trump also criticized India's economic ties with Moscow, saying the country was 'Russia's largest buyer of ENERGY, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE.'
India's commerce ministry said it was studying the implications of Mr. Trump's announcement. It said in a statement that India remained committed to 'concluding a fair, balanced and mutually beneficial bilateral trade agreement.'
The announcement came as the Trump administration prepared to finalize higher tariffs on many countries globally as of Friday. The European Union, Japan and other governments have signed trade agreements that somewhat lowered the tariffs Mr. Trump threatened on them earlier this year. But according to tracking by Goldman Sachs, trading partners accounting for 56 percent of U.S. imports — including Canada, Mexico, South Korea, Brazil and India — have not yet signed preliminary agreements. On Wednesday, Mr. Trump wrote that the deadline 'STANDS STRONG, AND WILL NOT BE EXTENDED.'
Mr. Trump's announcement was an ill omen for relations between the United States and India, which have grown closer amid a more aggressive international posture from China. India is a major commercial partner of the United States, with total trade between the two countries amounting to roughly $130 billion last year. The countries also have deep cultural and demographic ties.
The relationship between Mr. Trump and India's prime minister, Narendra Modi, has generally been warm, and in recent weeks the countries seemed close to clinching a trade deal.
But those talks appear to have hit obstacles, including Mr. Trump's desire for India to open up its agricultural and dairy markets, while India wants to maintain certain protections. Mr. Trump has also sought to retain a relatively high tariff on Indian goods even under a trade agreement, something the Indian government has viewed as unacceptable. The commerce ministry's statement made indirect reference to some of the apparent sticking points, including 'protecting and promoting the welfare of our farmers, entrepreneurs' and small businesses.
India has long maintained high barriers to trade, which has brought the government into conflict with Mr. Trump, himself an avid protectionist. India has a trade-weighted average tariff of 12 percent on all goods. For a number of American imports, it imposes tariffs of 100 percent or more and maintains non-tariff barriers to protect agriculture and other industries.
Farwa Aamer, the director of South Asian Initiatives at the Asia Society Policy Institute, a think tank, said that even with an early start to talks, 'the timeline was too tight, given India's sectoral concerns and strong reservations on opening access to its dairy and agriculture markets.'
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Mr. Modi has also been under pressure domestically not to be seen as caving to Mr. Trump. The prime minister is in the midst of a parliamentary session during which he has faced criticism for another Trump-related matter. To Mr. Modi's embarrassment, Mr. Trump has repeatedly insisted that it was his use of trade leverage that prompted India and Pakistan to agree to a cease-fire in their conflict this spring, rather than India's military operations.
Nisha Biswal, a partner in The Asia Group and a former assistant secretary of state for South and Central Asia, said the president's announcement was 'unfortunate' but 'not entirely surprising.' While the trade negotiations have made tremendous progress, she said, 'playing hardball with a friend and partner may have surprised the Indians but it is a tactic the president uses frequently.'
'The real tragedy would be if both sides walk away from a big win,' she said, adding, 'the implications for U.S. businesses and India's economy could be quite severe.'
Mr. Trump also said Wednesday that India would pay a penalty tariff for its purchases of Russian oil. If enacted, that would be the first use of what Mr. Trump has taken to calling 'secondary tariffs,' a kind of penalty that would be imposed instead of the financial sanctions typically used against countries that do business with embargoed nations. Mr. Trump has been moving to replace some of the traditional sanctions tools in the U.S. arsenal with an expanded use of tariffs.
Alan Rappeport and Mujib Mashal contributed reporting.