US President Donald Trump on July 30 announced that the United States will impose a 25% tariff on Indian imports starting August 1. However, smartphones and a few other sectors remain exempt. He said that India’s tariffs on American goods are very high. He also called India’s trade barriers the most strenuous and obnoxious non-monetary among all countries. The announcement was made via Truth Social, the social media platform owned by Trump.
In addition to the new tariffs, Trump also hinted at an unspecified “penalty” for India’s ongoing purchases of Russian weapons and energy, signalling growing tensions between Washington and New Delhi.
The upcoming tariff measures are expected to affect several major Indian sectors, including textiles, automobile components, steel and aluminium, solar equipment, IT services, and parts of the pharmaceutical industry. However, laptops, smartphones and pharmaceuticals have been exempted from the tariff hike, at least for now.
Also read: Google Pixel 10 series price leaks ahead of August launch: Here’s how much you might have to pay
Notably, India exported $14.6 billion worth of smartphones and $10.5 billion in pharmaceuticals to the US in FY2025. These segments are not subject to the 25% tariff or the 10% baseline duties introduced in April, allowing for continued growth. According to reports, Indian exporters have front-loaded shipments of exempted goods in anticipation of the new duty, resulting in a 17-18% hike in exports in early 2025 to over 20% by June. While the exemptions provide temporary relief, the smaller and mid-sized exporters reliant on the US market will be affected by these high tariff rates.
Also read: Jio vs Airtel: Best prepaid recharge plans under Rs 500 compared
The new tariffs are slated to take effect Friday, August 1, unless trade talks between the two countries lead to a last-minute resolution.