PM Modi and Trump
US President Donald Trump has once again created a stir in global trade. From 1 August 2025, it has been announced to impose a new tariff of 10% on things imported from 100 countries. This has been confirmed by American Treasury Secretary Scott Besant. It is considered a major change in America’s Global Trade Policy. Many countries including India can be vulnerable to this new tariff. Come, let’s understand what will be the effect on India.
What is a new tariff plan?
The US has decided that from August 1, it will impose 10% mutual tariff on goods coming from about 100 countries. Scott Besant said on Bloomberg Television, “We will see how President Trump deals with countries that are talking with good intentions. But, at least 10% will be targeted on 100 countries and then the matter will move forward from there.” President Trump has signed 12 countries on the letters containing tariffs in the style of ‘Lo or Quit’. In these countries, some countries of India, Japan and European Union are said to be included, although Trump refused to name. These letters will be formally sent on Monday.
The purpose of this tariff is to promote American exports and to make business conditions in favor of America. However, imposing tariffs on such a large scale is considered to be the most aggressive trade policy in decades, because it will affect about half the countries of the world.
How much will the effect be affected on India?
This news is very worrying for India. At present, India is exempted from 26% tariffs on its goods in America, but this discount is ending on 9 July. If there is no new trade agreement till then, then from August 1, there may be a huge tariff on goods going from India. In recent weeks, talks between India and America have intensified. Indian officials have returned after discussing with Washington, but no deal has been finalized so far.
The biggest screw in talks between India and America is about agriculture and dairy sector. The US wants India to open its agriculture and dairy markets for genetically modified (GMO) imports. At the same time, India demands that labor-intensive exports like its cloth, leather and gems get more access in America. Apart from this, the US has clearly refused to give relief to any country including India in steel tariffs.
Many challenges in front of India
This tariff can be a major setback for India, because America is a major export market in India. India may suffer major losses in areas such as textile, leather, gems and jewelery. If the tariff is applied, the Indian goods will become expensive in the US market, which can reduce their demand. There is now a shortage of time for Indian traders and government. If no agreement is reached by 9 July, then the impact of the tariff will start from 1 August.
Experts believe that the Government of India is now under pressure to make an interim agreement with the US as soon as possible. But, in front of the strict conditions of America, India also has to protect its interests. Especially, India is cautious about its policies in agriculture and dairy sectors. The coming week will be very important for Indo-US trade relations. If there is no agreement, Indian exporters may have to suffer a big loss.