Donald Trump announces 25% tariff and penalty on India

US President Donald Trump on Wednesday, July 30, announced a 25% tariff on Indian goods starting August. President Trump also imposed a penalty on India which was not quantified in his social media post.

Trump termed India's tariffs as most strenuous and obnoxious non-monetary trade barriers of any Country.

"Remember, while India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country," Trump said in a post on his social media portal TruthSocial.

Along with 25% tariffs, Trump also imposed a penalty on India saying that India has been buying military equipment and energy from Russia.

"Also, they have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of ENERGY, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE — ALL THINGS NOT GOOD! INDIA WILL THEREFORE BE PAYING A TARIFF OF 25%, PLUS A PENALTY FOR THE ABOVE, STARTING ON AUGUST FIRST. THANK YOU FOR YOUR ATTENTION TO THIS MATTER. MAGA!," Trump wrote.

Trump on Tuesday said that a trade agreement with India has not yet been finalised and hinted that higher tariffs on Indian imports, possibly in the range of 20% to 25%, could be on the table.

On April 2 this year, Trump announced high reciprocal tariffs. India was subject to a 26% tariff. The implementation of high tariffs was immediately suspended for 90 days till July 9 and later until August 1, as America is negotiating trade deals with various countries.

India has so far resisted US demands for tariff reductions on sensitive sectors such as agriculture and dairy, areas farmers' unions have warned should remain off the table. India has never offered dairy tariff concessions in previous free trade agreements.

Washington is pushing for broader access for US exports ranging from electric vehicles and petrochemicals to apples, dairy products, wines, and genetically modified crops.