President Donald Trump has announced a 25% tariff on all Indian exports to the US starting August 1.
Minister Piyush Goyal emphasized that the government is assessing the impact and will take all necessary steps to protect exporters, MSMEs, and farmers.
The development comes ahead of the sixth round of India-US bilateral trade negotiations.
India will take all necessary measures to protect national interests, Commerce and Industry Minister Piyush Goyal said on Thursday, responding to US President Donald Trump’s announcement of a sweeping 25% tariff on all Indian exports from August 1, along with penalties for India’s continued trade with Russia.
Making a suo motu statement in both Houses of Parliament, Goyal confirmed that the government is examining the implications of these tariffs and consulting stakeholders, including exporters and industry representatives, before finalizing its course of action.
“The government attaches the utmost importance to protecting and promoting the welfare of our farmers, workers, entrepreneurs, exporters, MSMEs, and all sections of industry,” Goyal told PTI.
The imposition of tariffs comes days before the sixth round of India-US trade negotiations, scheduled to begin August 25. A US trade delegation is due to visit New Delhi in hopes of finalizing an interim deal as part of the broader Bilateral Trade Agreement (BTA), which aims to boost bilateral trade to $500 billion by 2030.
The current trade volume stands at $191 billion, with India enjoying a trade surplus of $41 billion in 2024–25.
The US has pushed India for access to its agricultural, dairy, automotive, and wine sectors. In contrast, India has refused to lower tariffs on sectors such as dairy and agriculture due to domestic political implications and national food security concerns.
“India has never opened the dairy sector in any free trade agreement,” Goyal noted, stating that the government remains committed to rural livelihoods and food security, as per PTI.
India is also seeking tariff relief on exports such as textiles, jewellery, leather, shrimp, grapes, and bananas, while requesting the removal of additional duties on steel and aluminium.
In a statement that added to diplomatic tensions, Trump criticized India’s economic ties with Russia:
“I don't care what India does with Russia. They can take their dead economies down together,” Trump said, further stating that “India’s tariffs are among the highest in the world”.
White House advisers noted that Trump was frustrated with what he saw as “slow progress” on the trade deal and believed the tariffs would “remedy” that.
Goyal underlined India’s economic fundamentals, stating the country has transitioned from being part of the “fragile five” to becoming the world’s fastest-growing major economy.
“International institutions now regard India as a bright spot, contributing nearly 16% to global growth,” he said.
He also highlighted India’s free trade agreements with the UAE, UK, Australia, and EFTA countries and reiterated the commitment to mutually beneficial trade frameworks going forward.
The US has yet to issue an executive order detailing the structure and scope of the proposed tariff hike and penalties.
“Let us wait and watch how things evolve. The ball is in the US court,” a government source commented, as per PTI.
Meanwhile, opposition parties have criticized the government for what they call a “diplomatic and trade failure,” urging transparency in the negotiations and protection for vulnerable sectors.
As the situation develops, all eyes will be on the August trade talks, which could determine the trajectory of India-US economic relations for the remainder of the decade.
With inputs from PTI
