Overview

• Tariffs took effect on August 27, lifting duties on many Indian goods to 50% by combining a 25% reciprocal levy with a 25% penalty linked to Russian crude purchases, with limited carve‑outs and in‑transit allowances.
• White House trade adviser Peter Navarro intensified criticism, calling India an “oil money laundromat for the Kremlin” and dubbing the Ukraine conflict “Modi’s war,” as the administration framed the move as pressure over Russian oil.
• Formal trade negotiations have been postponed, but officials say informal contacts continue, India has ruled out immediate retaliation, and New Delhi signals talks could resume once the tariff dispute is addressed.
• Analysts estimate a $48–60 billion hit focused on labor‑intensive sectors such as textiles, gems and jewellery, seafood and footwear, with warnings of job losses and growth drag; exporters report cancellations and a rupee slide to a record low.
• India is preparing liquidity support and export‑diversification steps, accelerating FTA efforts in the Middle East and with the EU, and planning export‑promotion measures, while some U.S. lawmakers criticize singling out India over Russian oil.