President Donald Trump has declared a new 25 percent tariff on Indian goods, citing the need to address a long-standing trade imbalance between the United States and India.
In an announcement made via his Truth Social account on Wednesday, Trump emphasized that despite India being considered an ally, the trade relationship has been hindered by high tariffs imposed by India.
He stated, “While India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high.”
In addition to the tariffs, Trump plans to impose a penalty related to India’s continued purchase of military equipment and oil from Russia.
The president argues that this trade with Russia has contributed to the ongoing conflict in Ukraine, and he intends to take action starting Friday as part of his administration’s broader trade strategy.
The Indian government has acknowledged Trump’s tariff decision and is currently evaluating its potential implications on the bilateral trade relationship.
This aggressive stance on trade represents a significant shift in the dynamics between Trump and Indian Prime Minister Narendra Modi, whose relationship had been generally warm during Trump’s initial term in office.
Challenges, however, have surfaced over issues of trade and immigration, with Modi directly countering Trump’s claims of mediation during a recent conflict with Pakistan.
While India’s relations with the United States may face turbulence, Pakistan has seen an increased standing within the Trump administration.
In a notable event in June, Trump hosted Pakistan’s army chief, Asim Munir, at the White House, marking an unprecedented move as this was the first time a U.S. president had engaged with a military chief from Pakistan not holding the position of the country’s head of state.
Trump’s announcement of tariffs comes in the context of several recent trade agreements negotiated with countries including the European Union, Japan, the Philippines, and Indonesia.
According to Trump, these agreements will enhance market access for American products while allowing the country to impose higher import taxes.
The administration views the revenues generated from tariffs as a means to counterbalance budget deficits exacerbated by recent income tax reductions and to foster job creation in domestic manufacturing.
The Census Bureau reported a substantial trade deficit of $45.8 billion between the U.S. and India last year, highlighting the imbalance as the U.S. imported significantly more than it exported.
India, with its population exceeding 1.4 billion, stands as the world’s largest democracy and is seen as a potential strategic counterweight to China.
Despite international pressure, India has maintained strong ties with Russia and has not aligned itself with Western sanctions regarding the ongoing conflict in Ukraine.
In a prior meeting in February with Modi, Trump indicated that India would commence purchasing American oil and natural gas, hinting at a shift in the bilateral trade flow.
During a flight back from Scotland, Trump declined to elaborate on discussions surrounding the forthcoming tariff, although he acknowledged that trade agreements with India have yet to be finalized.
As trade negotiations continue to unfold, the implications of these tariff measures remain uncertain, with experts predicting potential economic repercussions, including a slowdown in U.S. economic growth and increased inflation pressures.
image source from：aljazeera
