Trump tariff tests India-US trade ties

Economists estimate the tariff impact could shave 20-50 basis points off India's GDP growth in FY26

- VISMAY BASU @ New Delhi

INDIA is bracing for fresh economic pressure as the United States under President Donald Trump rolls out a sweeping tariff regime, with Indian exports now facing a 25% duty effective August 1. The move comes after a series of aggressive executive actions since Trump's return to the White House, marking one of the most significant shifts in US trade policy in decades.

The tariff escalation began on February 1, when Trump invoked emergency powers under the International Emergency Economic Powers Act (IEEPA), imposing a 10% tariff on Chinese imports and 25% on most goods from Canada and Mexico. These took effect on February 4, followed by a hike in Chinese tariffs to 20% on March 3. Tariffs on Canadian and Mexican goods followed.

On March 12, global tariffs on steel and aluminum were raised to 25% under Section 232, and later doubled to 50% for all countries except the UK by June 4. A 25% tariff on countries still importing Venezuelan oil took effect April 2, with further duties on automobiles and auto parts phased in.