Push for local products as new US tariffs take effect

Extra tariff to punish India's Russian oil purchases takes total levies to a steep 50%

- Dhirendra Kumar

The Centre is doubling down on locally made products to counter a likely drop in overseas shipments, as hefty US tariffs kick in and President Donald Trump vows to punish countries targeting US technology firms.

India aims to wait out the deadlock with the local push, four people aware of the plan said, after US trade talks stalled and its president Donald Trump put India in crosshairs. Earlier in the day, the US notified an extra tariff of 25% on Indian goods, citing New Delhi's refusal to stop buying Russian oil, raising total levies to a steep 50%.

India's position on not granting wider market access for American agricultural and dairy products remains unchanged, and a solution may be several months or even years away, the first of the four people said.

In the meantime, the government plans to unleash a campaign to promote local goods, and may extend duty drawback incentives for several goods. Duty drawback rates are refunds for import duties for materials used to make goods which are exported later.

Prime Minister Narendra Modi, who made a strong push for India-made products on 15 August, on Tuesday urged citizens to buy local goods and requested retail outlets to display 'Swadeshi Only' signboards. The officials said the plan is to drive the narrative further, with US trade talks effectively at a standstill.

"Swadeshi is not new; it has been there for a long time. The government is now planning to encourage consumers to buy only India-made products, while traders would also be advised to procure domestically manufactured goods instead of relying on imported items," the second person said.