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In a major policy shift, US President Donald Trump announced a set of revised reciprocal tariffs on several nations, including India, in an effort to counter what he perceives as unfair trade practices. Under the new policy, India will face a 26% tariff on its exports to the United States. The move, which Trump described as a “kind reciprocal,” is aimed at partially countering the tariffs these countries impose on American goods.
During a press briefing at the White House on Wednesday, Trump presented a comparative chart illustrating the disparities in trade tariffs between the US and its global partners. He claimed that India levies a 52% tariff on American imports while the US has historically maintained much lower duties on Indian goods.
US President Donald Trump imposes 26% “reciprocal tariffs” on India, followed by 34% on China, 20% on EU, and 24% on Japan pic.twitter.com/0uhLSCKSOV
— ANI (@ANI) April 2, 2025
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According to a senior White House official quoted by Reuters, the newly imposed tariffs will take effect on April 9 at 12:01 am. Trump referenced Indian Prime Minister Narendra Modi’s recent visit to the US, acknowledging their strong personal rapport but criticizing India’s tariff policies.
“The Prime Minister just left. He’s a great friend of mine, but I told him, ‘You’re not treating us fairly.’ India has been imposing a 52% tariff on us, while we have been charging them almost nothing for decades,” Trump remarked.
Broad Tariff Measures and Global Impact
Beyond India, the revised tariff policy encompasses various countries, with rates ranging from 10% to a maximum of 49% for Cambodia. Trump also announced a baseline tariff of 10% on all imports, with higher rates for nations with substantial trade surpluses against the US. Additionally, a 25% tariff on automobiles assembled outside the US will be enforced starting April 3, a move expected to impact global car manufacturers and raise vehicle prices.
“If you want to avoid tariffs, manufacture in America,” Trump asserted. “Otherwise, foreign nations must pay a fair price to access the US market.”
Trump further emphasized that trade deficits have escalated into a national emergency, necessitating strong corrective measures. “For decades, American taxpayers have been exploited. This is our declaration of economic independence,” he stated.
Labeling April 2 as ‘Liberation Day’ for American trade, Trump defended his decision, arguing that he exercised restraint despite the option to impose even harsher levies. Under the new structure, China will face a 34% tariff on its exports to the US, while the European Union will be charged 20%. Other notable rates include 25% on South Korea, 24% on Japan, and 32% on Taiwan.
Following the announcement, Trump officially signed an executive order to implement these changes.
Impact On India
India, a key trading partner of the US, is expected to experience some disruption due to the tariff hike. Market analysts predict potential challenges for Indian exporters, particularly in sectors dependent on US trade. However, a report from SBI Research suggests that India may not suffer significant losses, estimating only a 3-3.5% decline in exports.
The report credits India’s ability to mitigate the impact through export diversification, improved value addition, and new trade corridors, including a strategic route linking Europe to the US via the Middle East.
Before the tariffs were announced, India’s Commerce and Industry Minister Piyush Goyal had been in Washington, leading negotiations for a potential bilateral trade agreement (BTA). Efforts to secure exemptions from the new levies remain ongoing, with both nations striving to finalize a comprehensive trade deal by the end of the year. The long-term goal remains to boost bilateral trade to $500 billion by 2030.
While the reciprocal tariffs may introduce new hurdles for Indian exporters, strategic trade realignments and continued dialogue between the two governments could help minimize disruptions and sustain economic momentum.
