US President Donald Trump has imposed an additional 25% tariff on Indian goods due to New Delhi’s continued purchases of Russian oil, bringing the total duty on affected imports to 50%, one of the highest rates imposed by the US on any trading partner.
India’s Ministry of External Affairs condemned the move as “unfair, unjustified and unreasonable,” stressing that its imports are market-driven and essential for the energy security of 1.4 billion citizens. Exporters have warned the steep tariff may severely impact key sectors, while analysts predict possible export losses of up to $87 billion, affecting areas such as textiles, machinery, pharmaceuticals and gems and jewellery.
Earlier, on 6 August, Reserve Bank of India Governor Sanjay Malhotra said the tariff hike is unlikely to significantly affect India’s economy unless retaliatory duties are introduced. “There might not be a major impact of the ongoing uncertainty over the US tariffs on India’s economy. This is subject to retaliatory tariffs coming into the picture, which we do not foresee,” he said.
He added that the RBI has factored in global uncertainties while revising its GDP growth forecast to 6.5%. Malhotra also assured that forex reserves are sufficient to finance up to 11 months of imports, and Deputy Governor Poonam Gupta noted that nearly half of India's inflation basket is food, limiting inflation exposure from global shifts.
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