U.S. President Donald Trump signed an executive order on Tuesday that imposed an additional 25% tariff on Indian goods, virtually raising the overall charge to 50%, in a significant escalation of trade tensions. The move, according to the White House, is a direct response to India’s continued import of Russian crude oil, despite ongoing Western sanctions on Moscow.
Speaking during an interview with CNBC, Trump said the U.S. has been “taken advantage of” by India on trade for too long.
“India has not been a good trading partner because they do a lot of business with us, but we don’t do business with them,” he said. “So we settled on 25 percent, but I think I’m going to raise that rate quite substantially in the next 24 hours.”
True to his word, Trump signed the order late Tuesday evening. The decision invokes powers under the International Emergency Economic Powers Act, the Trade Act of 1974, and other federal laws previously used to sanction countries tied to Russian oil purchases.
What the Executive Order Says
The order, citing the continuation of the national emergency outlined in Executive Order 14066 (March 8, 2022), states that India is directly or indirectly importing oil from Russia, thereby undermining global efforts to isolate the Kremlin for its war on Ukraine.
“To deal with the national emergency… I determine that it is necessary and appropriate to impose an additional ad valorem duty on imports of articles from India,” the order reads.
The new tariffs will go into effect 21 days from the signing date, becoming enforceable after 12:01 a.m. EDT, unless the shipments are already in transit.
“Unjustified and Unreasonable”
India’s Ministry of External Affairs (MEA) issued a sharp rebuttal earlier this week, even before the executive order was signed, responding to Trump’s tariff threats.
“This kind of unilateral pressure is unjustified and unreasonable,” the MEA said in a statement. “India has maintained transparent trade ties with partners across the globe, including the U.S. and EU. It is regrettable that New Delhi is being singled out.”
The ministry also criticized the “double standards” of the West, pointing out that European countries continue to engage with Russia in various sectors, including energy.
Also Read: India Contributing More to Global Growth Than US, Says RBI Chief Amid Trump Row
What It Means for Trade
The decision is likely to have significant repercussions for India–US trade relations, which have seen ups and downs during both Trump’s and Biden’s presidencies. Pharmaceuticals, textiles, car components, engineering equipment, and IT services are among the billions of dollars worth of goods that India sells to the United States.
According to the sources, a 50% tariff rate could severely affect small and mid-sized Indian exporters, especially in labor-intensive sectors.
Meanwhile, no indication has yet emerged whether New Delhi will respond with retaliatory tariffs, though officials suggest all options are on the table.
The escalation is part of Trump’s continued use of tariffs as foreign policy leverage, a strategy that defined much of his first term. The latest move, however, may complicate global diplomatic efforts to present a united front against Russia’s war in Ukraine, especially as India continues to maintain a neutral stance while purchasing Russian oil at discounted rates.
