US Tariffs on India: The US has now imposed major tariffs on India. While both countries are still discussing a trade deal, US President Donald Trump has announced a 25% tariff on goods coming from India—despite calling India a ‘friend’.
In addition, the US is also penalizing India for buying oil and military equipment from Russia. These new tariffs and penalties will take effect on August 1.
These tariffs match the ones previously announced on April 2 this year. Back then, the tariff rate was set at 26%.
However, on April 9, Trump gave India and some other countries a 90-day break from the high tariffs.
During this period, only a 10% base tariff was applied. Now that the 90-day relief is over, the US has announced a 25% tariff along with penalties for India, effective July 30.
Compared to other Asian countries, India is facing a higher tariff. For example, the US has imposed a 19% tariff on Indonesia and 20% on Vietnam and the Philippines.
In contrast, Myanmar faces a 40% tariff, Thailand 36%, Bangladesh 35%, and Sri Lanka 30%.
India’s Tariffs Are Higher Than Some Asian Countries
(US Tariffs in %, as of now and on April 2, 2025)
| Country | Now | 02-Apr-25 |
|---|---|---|
| Brazil | 50 | 10 |
| Laos | 40 | 48 |
| Myanmar | 40 | 44 |
| Thailand | 36 | 36 |
| Cambodia | 36 | 49 |
| Bangladesh | 35 | 37 |
| Serbia | 35 | 37 |
| Canada | 35 | 25 |
| South Africa | 30 | 30 |
| Bosnia & Herzegovina | 30 | 35 |
| Sri Lanka | 30 | 44 |
| Libya | 30 | 31 |
| Algeria | 30 | 30 |
| Iraq | 30 | 39 |
| Mexico | 30 | 25 |
| India | 25+ | 26 |
| South Korea | 25 | 25 |
| Malaysia | 25 | 24 |
| Kazakhstan | 25 | 27 |
| Tunisia | 25 | 28 |
| Brunei | 25 | 24 |
| Moldova | 25 | 31 |
| Philippines | 20 | 17 |
| Vietnam | 20 | 46 |
| Indonesia | 19 | 17 |
| EU | 15 | 20 |
| Japan | 15 | 24 |
Source: Truth Social, media reports, Moneycontrol. Table created with Datawrapper.
Why Did Trump Impose Tariffs and Penalties on India?
Posting on Truth Social, Trump explained that the US has a large trade deficit with India.
se of their high tariffs—some of the highest in the world.”
He also said India has strict non-monetary trade barriers that are worse than most countries.
Trump also criticized India for buying a significant amount of military gear from Russia and being one of the biggest buyers of Russian oil—along with China—at a time when the world wants Russia to stop its war in Ukraine.
Trump said, “This is not acceptable.” So, the US will impose a 25% tariff and an additional penalty. However, the amount of the penalty has not been disclosed yet. These measures start on August 1.
How US-India Trade Has Changed in the Past 10 Years
An analysis of United Nations Comtrade data by Moneycontrol shows that trade between India and the US has nearly doubled in the last 10 years.
In 2013, trade was worth $64.6 billion, and by 2024, it had grown to $118.4 billion. The type of goods traded has also changed.
India’s exports of textiles, clothing, and stone products have declined, while exports of machinery, electronics, and chemicals have grown rapidly.
In 2024, machinery and electronics made up about 25% of India’s exports to the US—up from less than 8% in 2013. From August 1, there’s concern that these exports may face serious disruption due to the new tariffs.
On the import side, India now relies more on the US for fuel. In 2024, fuel made up 31.5% of US exports to India, compared to just 7% in 2013. Imports of metals from the US have also increased.
India’s Exports to the US Rose 23% in June
According to recent data, India’s exports to the US rose by 23.53% to $8.3 billion in June 2025. Meanwhile, US imports to India dropped by 10.61% to about $4 billion.
Between April and June 2025, India’s exports to the US increased by 22.18% to $25.51 billion.
During the same period, imports grew by 11.68% to $12.86 billion. In the financial year 2025, India also received $5.45 billion in foreign direct investment (FDI) from the US.
