The extra 25% tariff imposed by U.S. President Donald Trump on India for its purchases of Russian oil got here into effect Wednesday (August 27, 2025), bringing the entire quantity of levies imposed on New Delhi to 50 per cent.
The Department of Homeland Security (DHS), in a draft order revealed on Monday (August 25, 2025), mentioned the elevated levies would hit Indian merchandise which might be “entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on August 27, 2025”.
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Mr. Trump had introduced reciprocal tariffs of 25% on India that got here into effect on August 7, when tariffs on about 70 different nations additionally kicked in.
On August 7, the U.S. President introduced doubling tariffs on Indian items to 50% for India’s purchases of Russian crude oil, however gave a 21-day window to barter an settlement.
On Monday (August 25, 2025), Prime Minister Narendra Modi asserted he can’t compromise on the pursuits of farmers, cattle-rearers, small-scale industries, cautioning “pressure on us may increase, but we will bear it”.
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“Products of India, except those set forth in section 3 of Executive Order 14329, that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on August 27, 2025, will be subject to the additional ad valorem rate of duty,” the DHS order learn.
However, Indian merchandise can be exempt from the brand new 50% tariff in the event that they have been “already loaded on a ship and in transit to the U.S. before 12:01 am (EDT) on August 27, 2025, provided they are cleared for use in the country or taken out of a warehouse for consumption before 12:01 am (EDT) on September 17, 2025, and the importer certifies this to U.S. Customs by declaring the special code HTSUS 9903.01.85”.
Commenting on the extra tariffs on India, Mark Linscott, Senior Advisor with Washington, D.C.-based enterprise consulting and advisory agency The Asia Group, mentioned that “unfortunately”, the U.S. and India have managed to transform what seemed to be a real and unprecedented win-win on commerce into a “remarkable lose-lose”.
“For the moment, the trade talks on reciprocal tariffs are on thin ice while the two sides stew over how to reach an understanding on Russian oil purchases. Hopefully, cooler heads who understand the value of the relationship will prevail in finding the path forward,” Mr. Linscott mentioned.
Partner at The Asia Group Nisha Biswal mentioned the 50% tariffs on India — now the best of any U.S. buying and selling companion — can be massively disruptive, pricing Indian textiles and clothes out of the U.S. market.
“U.S. businesses have also lost the unprecedentedly low tariff rates that USTR (United States Trade Representative) had previously negotiated. The move also casts doubt on the China+1 strategy, creating uncertainty for companies that had shifted production to India,” she mentioned.
“The short-term impact of these tariffs will be undoubtedly severe, but a path forward remains possible if Modi and Trump engage directly to restore trust and strike a workable agreement,” Ms. Biswal added.
Managing Principal at The Asia Group Basant Sanghera mentioned the secondary tariffs can be extremely damaging to U.S.-India financial ties and India’s manufacturing ambitions.
“Without some level of leader-level engagement, the trade relationship will remain in the doldrums, with risk of further damage,” he mentioned.
U.S. Treasury Secretary Scott Bessent has accused India of “profiteering” by reselling Russian oil. India has referred to as the tariffs imposed by the U.S. “unjustified and unreasonable”.
