August 27, 2025 | 08:00 pm
TEMPO.CO, Jakarta - The United States has officially imposed 50 percent tariffs on Indian products, a move announced by President Donald Trump and enforced starting Wednesday, August 27, 2025. The new duties come as Prime Minister Narendra Modi urged citizens to strengthen domestic purchases in pursuit of “self-reliance.”
The U.S. Department of Homeland Security confirmed plans to raise an additional 25 percent import duty on top of the existing tariffs, bringing the total levy to 50 percent.
Penalty for Oil Imports from Russia
Washington’s latest action follows Trump’s decision earlier this month to apply a 25 percent tariff on Indian goods. The added 25 percent is being billed as a penalty for India’s continued imports of discounted crude oil from Russia.
More than a third of India’s crude oil imports last year came from Russia, a relationship criticized by U.S. officials. Trump’s trade adviser, Peter Navarro, accused India of “ignoring its role in fueling bloodshed in Ukraine.”
With this move, Indian exporters now face some of the highest import duties imposed under Trump’s trade policies, alongside Brazil, which is also hit with 50 percent tariffs on many of its exports.
Trade negotiations between Washington and New Delhi have meanwhile stalled, largely due to India’s refusal to open its agricultural market to cheaper U.S. imports, a move Modi says would harm millions of Indian farmers.
Bilateral Trade at Risk
The trade relationship between the U.S. and India was valued at US$129 billion (Rp2,111 trillion) in 2024, with the U.S. running a US$45.7 billion (Rp747 trillion) deficit, according to the U.S. Trade Representative’s Office.
Analysts warn the new tariffs could affect up to US$87 billion worth of Indian exports. The Indian government has denounced the duties as “unfair, unjustified, and unreasonable,” estimating that at least US$48 billion in exports could be directly impacted, threatening jobs and growth in the world’s fifth-largest economy.
Impact on Labor-Intensive Industries
Economist Garima Kapoor of Elara Securities said the hardest-hit sectors would be labor-intensive industries, including textiles, garments, gems and jewelry, maritime exports, certain automotive products, and leather.
“All of these categories … are small and medium scale enterprise intensive. So we will see an impact being pretty severe in terms of employment,” Kapoor told Al Jazeera.
The Global Trade Research Initiative (GTRI), a New Delhi-based research institution, stated that the tariffs could erase India’s presence in the U.S.
“The new tariff regime is a strategic shock that threatens to wipe out India’s long-established presence in the US, causing unemployment in export-driven hubs and weakening its role in the industrial value chain,” said Ajay Srivastava, founder of GTRI and former Indian trade official.
For now, the U.S. has spared certain key sectors such as pharmaceuticals and electronics from the additional duties, though further investigations could lead to more tariffs.
Despite mounting pressure, Modi stressed his government would not compromise.
“For me, the interests of farmers, small businesses and dairy are topmost. My government will ensure they aren’t impacted,” he said during a public rally in Gujarat.
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