Steep US tariffs set to hit Indian exports from Wednesday
Indian exporters are bracing for a sharp decline in U.S. orders after trade talks collapsed and Washington confirmed steep new tariffs on Indian goods, effective from Wednesday.
The move, announced by President Donald Trump and detailed in a Homeland Security notice, adds an additional 25% duty, taking total tariffs as high as 50%—among the highest imposed by Washington. The measures come in retaliation for New Delhi’s increased purchases of Russian oil, News.Az reports, citing Reuters.
A commerce ministry official said there was “no hope for any immediate relief or delay” but noted exporters would receive financial assistance and be encouraged to diversify into markets such as China, Latin America, and the Middle East.
The new duties will apply from 12:01 a.m. EDT on Wednesday (9:31 a.m. IST). Shipments already in transit, humanitarian aid, and items under reciprocal trade programs will be exempt.
The Indian rupee slid to a three-week low of 87.68 per dollar, recovering slightly after suspected central bank intervention. Benchmark equity indexes NSE Nifty 50 and BSE Sensex each fell 1%, their worst session in three months.
Wednesday’s tariff escalation follows five rounds of failed talks. Both sides have blamed political missteps and missed signals for the breakdown, despite optimism earlier that tariffs could be capped at 15%.
White House trade adviser Peter Navarro and U.S. Treasury Secretary Scott Bessent accused India of indirectly funding Russia’s war in Ukraine through a surge in oil purchases. Russian crude now makes up 42% of India’s total oil imports, up from less than 1% before the war.
Industry groups estimate nearly 55% of India’s merchandise exports worth $87 billion could be hit, with sectors such as engineering, textiles, and chemicals most exposed. Competitors including Bangladesh, China, and Vietnam are expected to benefit.
“The U.S. customers have already stopped new orders,” said Pankaj Chadha, president of the Engineering Exports Promotion Council. “With these additional tariffs, exports could come down by 20–30% from September onward.”
The government has pledged support in the form of subsidies on bank loans and assistance with market diversification to cushion losses.
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