President Donald Trump has once again disrupted the global trade order and on July 31, 2025, just before his extended deadline expired, Trump issued a sweeping Executive Order revising ad valorem tariffs on imports from nearly 200 countries but among the hardest-hit is India, facing a 25% duty and a possible Russia-related penalty. The latest tariffs threaten years of trade diplomacy, push markets into panic, and demand a strong and strategic response from India.
Trump’s Tariff Tsunami Shakes Global Markets
This new order represents the highest effective US tariff rate since 1934—peaking at 18.3%, according to Yale University. The result? American households will likely pay $2,400 more annually. Markets responded swiftly. Stocks plunged across Asia, Europe, and Wall Street. Dow, S&P 500, and Nasdaq all closed significantly lower.
Tariffs by the Numbers: India Among the Worst Hit
India faces a 25% tariff, one of the highest among major economies. Trump also warned of a secondary penalty—possibly 100%—for India’s continued Russian defense and energy imports. This places Indian exports like pharma, automobiles, and textiles at risk. Meanwhile, Asian peers like Vietnam and Sri Lanka have seen their tariffs reduced to 20% or below.
ALSO READ: ‘India set to become…’ PM Modi Responds to Trump’s Dead Economy
Trump’s 90-Day Deal Push Falters
After pausing his April tariffs, Trump gave the world 90 days to negotiate. He claimed, “90 deals in 90 days.” But most outcomes were the result of coercion, not diplomacy. India held five rounds of talks, yet Trump suddenly imposed a steep tariff, calling India a “tariff king” and dismissing prior progress.
The Fallout: India’s Economy Could Take a Hit
Economists warn that India’s GDP may shrink 0.2–0.4% if the new tariffs persist but the export sectors—particularly MSMEs—will suffer the most. India’s ongoing mini-deal discussions with the US collapsed after Trump’s abrupt decision.
Time to Stand Firm: No Deal is Better Than a Bad Deal
India must now refuse any trade deal that compromises its strategic autonomy, while the US is India’s largest trade partner, New Delhi must expand ties elsewhere, as seen with its recent UK agreement. The government must protect local farmers, entrepreneurs, and MSMEs. Bharat cannot afford to be strong-armed into an inequitable trade pact.
ALSO READ: Trump Sends Nuclear Submarines Near Russia — Here’s Why That’s Troubling
