Trump’s 50% Tariffs on India: Real Risk or Political Rhetoric?

Published on July 8, 2025 | By Pavan Kumar

 

Let’s Talk About That 50% Tariff Threat

“You don’t slap a 50% tariff on a partner unless you’re sending a message.”

That quote stayed with me after watching former President Donald Trump’s interview last month. As someone working closely with Indian exporters at ScaleCode Solutions, I’ve seen how even the hint of a policy shift from the U.S. can rattle entire industries. And this one? It’s more than a headline—it's a possible game-changer.

In Trump’s own words, the idea is to impose a 50% tariff on Indian imports, allegedly to fix “imbalanced trade.” But trade isn’t a teeter-totter. It’s a system of interlocking trust, supply chains, and diplomacy—and this one could break a few bolts.

What’s Behind Trump’s Tariff Proposal on India?

At face value, Trump’s tariff plan sounds like a blunt-force solution to a complex problem. India is currently one of the top 10 trading partners of the United States, exporting over $80 billion in goods and services in FY24 alone. These exports range from textiles and jewelry to pharmaceuticals and IT services.

Trump’s argument? That the U.S. has been “too soft” on India when it comes to trade.

But here’s where nuance matters. Trade imbalances can’t be solved by simple penalties. In fact, tariffs often backfire—raising costs for American consumers and pushing India to diversify away from U.S. markets.

Expert Note: According to Dr. Arvind Subramanian, former Chief Economic Advisor to India, “Protectionist trade measures rarely fix deficits—they usually widen them in the long run.” 

The Tariff Shockwave: Who Stands to Lose?

Having worked with exporters in Gujarat and Tamil Nadu, I’ve heard real worries in their voices over the past week.

“My business survived COVID, demonetization, and a container crisis. This? It’s political warfare,” says Rajiv Malhotra, who runs a textile export house in Surat.   

Here’s a breakdown of Indian sectors that could feel the heat if Trump’s tariffs take effect:

SectorAnnual Export to USTariff Impact Textiles & Apparel$9.5BHighGems & Jewelry$10.2BHighPharmaceuticals$7.1BMediumSoftware & Services$25BMedium–Low

Primary Keyword Usage: Trump 50% Tariffs on India may specifically disrupt traditional manufacturing sectors more than tech, at least in the short term.

India Russian Oil Imports: A Quiet Power Move

What’s oil got to do with this?

A lot, actually. Over the past two years, India’s Russian oil imports have quietly but firmly shifted global energy alliances. In Q1 2024 alone, Russia supplied over 40% of India’s crude oil—more than any other country.

And why not? With discounts ranging from $6–8 per barrel, Indian refineries have slashed their costs significantly, even under global pressure from the West.

In my experience helping supply chain clients in Mumbai’s port logistics space, we’ve seen Russian oil imports help offset rising global freight charges. This is no minor trend—it’s economic self-preservation.

Are We Seeing a New Cold Trade War?

Here’s where it gets complex.

If the Trump 50% Tariffs on India are enacted, India may be pushed closer to Russia and BRICS allies. This would weaken the Western economic bloc’s dominance over trade flows and shift power dynamics in Asia.

Think of it this way: if trade becomes a tool of coercion, nations will naturally seek more resilient partners—not just wealthier ones. 

“This isn’t about trade deficits. It’s about shaping the new world order,” says Meera Narayan, geopolitical researcher at the Institute for Strategic Futures. 

 

What Should Indian Businesses Do Right Now?

The good news? We still have time—and options.

1. Diversify Export Markets

Explore untapped trade routes in Southeast Asia, Africa, and Latin America.

2. Digital Transformation

Startups and MSMEs must digitize supply chains and invest in lean operations.

3. Build in Bharat

India’s Tier 2 and Tier 3 cities are the next big consumer hubs. Dominate locally before going global.

4. Policy Advocacy

Partner with trade bodies like FIEO, NASSCOM, and CII to influence policy through dialogue—not panic.

A Global Trade Chessboard: Who Gains What?

Let’s connect the dots.

• China might step in as a buffer if Indian exports shrink.
• Russia could emerge stronger if energy ties with India deepen.
• Europe may benefit if India looks westward for new alliances.

This isn’t just India’s challenge. It’s a pivotal test for how global trade will evolve in a multi-polar world.

Final Take: Adversity or Advantage?

Let’s face it: no one wants a trade war. But every crisis forces a recalibration.

If Trump’s 50% tariffs on India do happen, it will sting—but it could also push Indian businesses to innovate faster, build stronger regional alliances, and reduce over-dependence on any one market.