Trump Announces 25% Tariff On India, ‘Plus A Penalty’ For Ties With Russia

President Donald Trump on Wednesday said India will face a 25% tariff plus an additional penalty starting August 1, citing high trade barriers and close ties with Russia. 

In a post on Truth Social, Trump called India’s tariffs “among the highest in the world” and criticized its purchases of Russian energy and military equipment. “India will therefore be paying a tariff of 25%, plus a penalty,” he wrote. 

The move escalates trade tensions just days ahead of Trump’s August 1 deadline for global tariff enforcement, which he said would not be extended earlier on Wednesday. India has not yet responded.

The U.S. trade deficit with India reached nearly $46 billion last year, driven by imports of pharmaceuticals, electronics, and apparel. Trump framed the trade negotiations as aiming for a “reciprocal” tariff structure to address this deficit.

While trade negotiations are ongoing between the U.S. and India, major points of contention have so far been agriculture, dairy sector access, and investment commitments. The additional penalty for doing business with Russia has not been reported before.

U.S. equity markets were trending higher in pre-market trade ahead of the Federal Reserve’s decision on interest rates later on Wednesday. The SPDR S&P 500 ETF (SPY) gained 0.15%, while the SPDR Dow Jones Industrial Average ETF (DIA) edged 0.4% higher. The Invesco QQQ Series 1 Trust (QQQ) was up 0.24%. 

On Stocktwits, retail sentiment around SPY jumped to ‘extremely bullish’ from ‘bullish’ over the past day. Meanwhile, retail sentiment around DIA remained in the ‘bullish’ zone.

Read also: Trump Asserts August 1 Deadline – 'It Stands Strong, And Will Not Be Extended'

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