Donald Trump has recently criticized India's trade practices, asserting that the country has treated the United States unfairly for decades. He claimed that India imposed high tariffs, which hindered American businesses. Trump also mentioned India's reliance on Russia for oil and military supplies. According to Trump, India's offer to cut tariffs came too late, as he believes the trade relationship has been a one-sided disaster for a long time.
Trump stated that India has offered to slash its import tariffs on American goods to "nothing". These remarks are set against a backdrop of plunging ties between the two countries, with the U.S. imposing levies as high as 50% on Indian goods.
The U.S. President's fresh remarks coincide with the meeting of leaders, including Indian Prime Minister Narendra Modi, Russian President Vladimir Putin, and Chinese Premier Xi Jinping, at the Shanghai Cooperation Organisation (SCO) summit.
These tariffs, which came into effect recently, risk inflicting significant damage on the Indian economy and further disrupting global supply chains. U.S. tariffs of 25% on Indian goods went into force earlier in August 2025, but Trump announced plans to double the rate, citing New Delhi's purchases of Russian oil, which the White House argues are indirectly funding Russia's war against Ukraine.
To avoid the extra U.S. tariff, India would have to replace about 42% of its oil imports. While Trump has accused India of indirectly funding Russia's war against Ukraine through its purchases of Kremlin crude, he has not taken similar action against China, another major purchaser.
India is now facing 50% tariffs on its goods exported to the U.S. Justifying Washington's newly imposed 50% tariffs on Indian imports, a U.S. official said that Indian refiners, working with “silent Russian partners,” were making huge profits by refining Russian oil and selling it in international markets while “Russia pockets hard currency to fund its war on Ukraine.”
Exporters have warned that labor-intensive sectors such as shrimp, chemicals, textiles, leather and footwear, and gems and jewelry would be particularly affected, as their products risk losing competitiveness in the American market to countries like Bangladesh, Vietnam and Thailand, which face lower tariffs.
India will not “bow down” to the United States and will instead turn its attention to attracting new markets, its trade minister has said. Speaking at a construction industry event in New Delhi, Piyush Goyal said India was “always ready if anyone wants to have a free trade agreement with us”.
Analysts have warned that the 50 percent duty the U.S. has imposed on Indian goods is akin to a trade embargo. The U.S. was India's top export destination in 2024, with shipments worth $87.3 billion.
