US President Trump Imposes 25% Tariff and Extra Penalty on India for Buying Russian Energy and Military Arms

In a further jolt to India-US bilateral relations back on the heels of Operation Sindoor, US President Donald Trump in a social media post on July 30, 2025 announced that US will impose 25% tariff on Indian goods from August 1. According to the President, India might face further penalty charges if the country continues to buy energy and military equipment from Russia. The 25% tariff rate is however lower than the 26% rate announced on April 2 ‘Liberation Day’ Conference.

In a microblogging post, Truth Social, US President Donald Trump said, “Remember, while India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country”.

“Also, they have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of ENERGY, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE — ALL THINGS NOT GOOD!” he added.

It might be noted that the US President Trump-led imposition of extra penalties on India comes close on the heels of 10-day ultimatum to Russia as a deterrent to stop conflict with Ukraine.

In a reaction to the development, India’s commerce and industry ministry in a statement said: “The Government is focussed on promoting the welfare of farmers, entrepreneurs and MSMEs. It is in the national interests that the Government will take steps to finalise any trade agreement along the lines of latest Comprehensive Economic and Trade Agreement (CETA) with the UK”.

Unlike the UK-FTA-CETA deal, PM Narendra Modi’s visit to the US failed to broker any interim trade deal. The next deal is expected in August 2025 when the US team is slated to visit India.