50% US tariff on India from today, direct impact

Trump administration issues order: 25% duty applicable from August 7, additional 25% applicable now due to oil purchase from Russia 50% tariff will be applicable on select exports from India to the US from Wednesday. Of this, 25% tariff is applicable from August 7, while the 25% penalty tariff imposed by US President Donald Trump for buying oil from Russia is going to be applicable from Wednesday. Its draft notice has been issued by the Trump administration. The order is completely India-centric. There is no mention of China in it, which is the largest buyer of Russian oil.

The notice details the plan to impose an additional 25% tariff. This will directly affect India’s exports worth more than $48 billion to the US. According to the draft order issued by the US Department of Homeland Security, the increased duty will be applicable on those Indian products which enter the US for consumption on or after 12:01 am US time on August 27 or goods approved for consumption from the warehouse will be exempted.

The US tariff order states that those Indian products will be exempted from 50 percent tariff, which have already been loaded on the ship before 12:01 am on August 27 and are on their way to the US. These products have been approved for consumption or which are to be taken out of the warehouse for consumption before 12:01 am on September 17.

This means that the goods which have already reached the US, but are lying in the warehouse of the importers there and have not yet been approved for consumption, will also be charged 50 percent tariff.

Apart from India, Brazil is the only US trading partner which is facing 50 percent import duty. India had called the announcement of such high tariffs by Trump as unfair and unwise. At the same time, White House Press Secretary Caroline Levitt had said, Trump has imposed sanctions on India to end the Russia-Ukraine conflict.

The tariff will affect the export of textiles, apparel, gems and jewellery, shrimp, leather and shoes, animal products

Challenge will come from the neighbours only

After the new tariff, the position of India’s competitors will improve in the US market. These include Myanmar (40 percent tariff), Thailand and Cambodia (36), Bangladesh (35), Indonesia (32), China and Sri Lanka (30), Malaysia (25), Philippines and Vietnam (20). The products of these countries will be available in the US market at lower prices than Indian products due to lower tariffs.

These will be affected: textiles, apparel, gems and jewellery, shrimp, leather and shoes, shoes, animal products, chemicals and electrical and mechanical equipment. These are outside the scope of pharmaceuticals, energy products and electronic components.

Accused of profiteering 66% exports will be affected

Global Trade Research Initiative (GTRI) claims that Trump’s 50% tariff can affect 66% of India’s exports to America. In such a situation, India will have to take immediate steps.

Danger of losing jobs

According to experts, 50% US tariff can have a huge impact on gems and jewellery, apparel, machinery, leather and chemical industries in India. Due to reduced production, jobs in these industries can also be in danger.

India has options

India will have to find new options for the American market. Especially exports will have to be increased from countries like Europe, South-East Asia and Africa. This will reduce dependence on America. It will help in reducing the impact of tariffs.

The government can take steps to provide subsidies and incentives to the industries affected by the tariff. In case of no agreement with America, India can also increase tariffs on American products.

India is the second largest buyer of oil from Russia… India is the largest buyer of Russian oil after China. From January to July, India is buying about 17.8 lakh barrels of oil from Russia every day.

Heavy selling in shares of realty, pharma, banking, telecom and metal companies

Market crashed due to Trump tariff… Sensex fell 849 points, Rs 5.57 lakh crores lost

The draft notice issued to impose 25 percent additional US tariff on Indian products – engulfed markets around the world. Domestic stock markets saw a huge decline due to all-round selling before the tariff was implemented. The BSE Sensex closed at 80,786.54, down 849.37 points or 1.04 percent. The NSE Nifty also closed at 24,712.05, down 255.70 points or 1.02 percent.

4 main reasons for the decline

50 percent US tariffs will be imposed on Indian products from August 27.

The high valuation of the Indian stock market remains a major concern. Foreign institutional investors are continuously selling in the domestic market.

Weak global signals put pressure on the Indian market.

Impact on stock markets around the world

In Asian markets, Hong Kong’s Hang Seng, Japan’s Nikkei-225, South Korea’s Kospi and Shanghai’s SSE Composite index were in decline. European and American stock markets also saw a decline.

Despite Trump’s threats, Apple will not slow down expansion in India

Despite Trump’s warning not to make iPhones in India, Apple is going to speed up its expansion. It will increase the production capacity of iPhones in India from 40 million to 60 million annually. It will invest $2.5 billion (Rs 21,500 crore). Most of the company’s additional production is for export. Especially to America. The company has started assembling the iPhone 17, which is going to be launched soon, in India. A government official said, there will be no change in Apple’s plan to invest in India. The expansion seems to be continuing as planned earlier. Apple’s expansion in India is supported by its major vendors, i.e. supplier Foxconn, Tata Group’s Wistron and Batron. US President Donald Trump has warned Apple not to make iPhones in India.

iPhones sold in America are made in India: Apple CEO Tim Cook said on July 31 in the January-March quarter that most of the iPhones sold in the US were made in India. India exported $17 billion worth of iPhones last year. China is now serving a large number of non-US markets.