Trump announces 25% tariff on India and unspecified penalties for buying
Russian oil
[July 31, 2025] By
JOSH BOAK and RAJESH ROY
WASHINGTON (AP) — The United States will impose a 25% tariff on goods
from India, plus an additional import tax because of India’s purchasing
of Russian oil, President Donald Trump said Wednesday.
The new tariffs were part of a flurry of trade activity that included a
series of executive actions regarding Brazil, copper and shipments of
goods worth less than $800, as well as a reduced 15% tax on imports from
South Korea, including its autos. It was all a prelude to Friday when
Trump's new tariff regime is scheduled to start, an event the White
House has portrayed as a testament to Trump's negotiating skills even as
concerns persist about the taxes hurting growth and increasing
inflationary pressures.
India “is our friend,” Trump said on his Truth Social platform
announcing the taxes, but its tariffs on U.S. products “are far too
high.”
The Republican president added India buys military equipment and oil
from Russia, enabling Moscow's war in Ukraine. As a result, he intends
to charge an additional “penalty” starting on Friday as part of the
launch of his administration’s revised tariffs on multiple countries.
Trump told reporters on Wednesday the two countries were still in the
middle of negotiations on trade despite the tariffs slated to begin in a
few days.
“We’re talking to India now," the president said. "We’ll see what
happens.”
The Indian government said Wednesday it's studying the implications of
Trump's tariffs announcement.
India and the U.S. have been engaged in negotiations on concluding a
“fair, balanced and mutually beneficial” bilateral trade agreement over
the last few months, and New Delhi remains committed to that objective,
India's Trade Ministry said in a statement.
Trump on Wednesday also signed separate orders to tax imports of copper
at 50% and justify his 50% tariffs on Brazil due to their criminal
prosecution of former President Jair Bolsonaro and treatment of U.S.
social media companies. Trump also signed an order saying that
government now had the systems in place to close the tariff loophole on
“de minimis” shipments, which had enabled goods priced under $800 to
enter America duty-free, largely from China.
The South Korea agreement will impose a 15% tariff, instead of the 25%
Trump had threatened. South Korea would also buy $100 billion in energy
resources from the U.S. and provide $350 billion for “investments owned
and controlled by the United States, and selected by myself, as
president,” Trump said.
There is also an agreement with Pakistan that includes the development
of its oil reserves. Meanwhile, Treasury Secretary Scott Bessent briefed
Trump on trade talks with China.
Trump's view on tariffs
Trump's announcement comes after a slew of negotiated trade frameworks
with the European Union, Japan, the Philippines and Indonesia — all of
which he said would open markets for American goods while enabling the
U.S. to raise tax rates on imports. The president views tariff revenues
as a way to help offset the budget deficit increases tied to his recent
income tax cuts and generate more domestic factory jobs.
While Trump has effectively wielded tariffs as a cudgel to reset the
terms of trade, the economic impact is uncertain as most economists
expect a slowdown in U.S. growth and greater inflationary pressures as
some of the costs of the taxes are passed along to domestic businesses
and consumers.
There's also the possibility of more tariffs coming on trade partners
with Russia as well as on pharmaceutical drugs and computer chips.
[to top of second column] |
President Donald Trump, front right, gestures as he walks down the
stairs of Air Force One with his grandchildren, Spencer, left, and
Chloe, back center, upon his arrival at Joint Base Andrews, Md.,
Tuesday, July 29, 2025. (AP Photo/Luis M. Alvarez)
 Kevin Hassett, director of the White
House National Economic Council, said Trump and U.S. Trade
Representative Jamieson Greer would announce the Russia-related
tariff rates on India at a later date.
Tariffs face European pushback
Trump's approach of putting a 15% tariff on America's long-standing
allies in the EU is also generating pushback, possibly causing
European partners as well as Canada to seek alternatives to U.S.
leadership on the world stage.
French President Emmanuel Macron said Wednesday in the aftermath of
the trade framework that Europe “does not see itself sufficiently”
as a global power, saying in a cabinet meeting that negotiations
with the U.S. will continue as the agreement gets formalized.
“To be free, you have to be feared,” Macron said. “We have not been
feared enough. There is a greater urgency than ever to accelerate
the European agenda for sovereignty and competitiveness.”
Seeking a deeper partnership with India
Washington has long sought to develop a deeper partnership with New
Delhi, which is seen as a bulwark against China.
Indian Prime Minister Narendra Modi has established a good working
relationship with Trump, and the two leaders are likely to further
boost cooperation between their countries. When Trump in February
met with Modi, the U.S. president said that India would start buying
American oil and natural gas.
The new tariffs on India could complicate its goal of doubling
bilateral trade with the U.S. to $500 billion by 2030. The two
countries have had five rounds of negotiations for a bilateral trade
agreement. While U.S. has been seeking greater market access and
zero tariff on almost all its exports, India has expressed
reservations on throwing open sectors such as agriculture and dairy,
which employ a bulk of the country’s population for livelihood,
Indian officials said.
The Census Bureau reported that the U.S. ran a $45.8 billion trade
imbalance in goods with India last year, meaning it imported more
than it exported.
At a population exceeding 1.4 billion people, India is the world’s
largest country and a possible geopolitical counterbalance to China.
India and Russia have close relations, and New Delhi has not
supported Western sanctions on Moscow over its war in Ukraine.
The new tariffs could put India at a disadvantage in the U.S. market
relative to Vietnam, Bangladesh and, possibly, China, said Ajay
Sahai, director general of the Federation of Indian Export
Organisations.
“We are back to square one as Trump hasn’t spelled out what the
penalties would be in addition to the tariff,” Sahai said. “The
demand for Indian goods is bound to be hit.”
___
Roy reported from New Delhi. Associated Press writers Samuel
Petrequin in Paris, and Darlene Superville and Seung Min Kim in
Washington contributed to this report.
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