WASHINGTON – The US and India are stuck in trade talks because President Donald Trump has said he won’t talk about trade with India until the new tariffs are lifted. The U.S. has put 50% tariffs on a number of commodities coming from India, which has made things between the two countries much worse.
When a reporter asked President Trump if he thought there will be more trade talks after the tariff announcement, he said, “No, not until we get it worked out.”
The tariffs are a two-part plan. A 25% tax went into effect on Thursday, and a 25% punitive tariff is set to go into effect on August 27. An executive order from the White House explained the second tariff by saying it was a response to India’s continued purchase of Russian oil, which it said “undermines U.S. efforts to counter Russia’s harmful activities.” The White House also said that India was “reselling this oil on the open market, often at a big profit,” which it says “further enables the Russian Federation’s economy to fund its aggression.”
India’s Bold Answer
Prime Minister Narendra Modi has reacted to the U.S. tariffs by saying that India will not give in on the needs of its farmers, fishermen, and dairy farmers. Modi said at a conference that he was “ready” to “pay a heavy price” to defend these sectors and that their interests were his “top priority.” The Ministry of External Affairs (MEA) has also labeled the tariffs “unfair, unjustified, and unreasonable.” They say that India’s oil imports from Russia are based on its economic needs and the goal of keeping its 1.4 billion people safe from energy shortages.
A trade war is coming
The U.S. tariffs have hurt India and Brazil a lot because they now have to pay a 50% levy on goods they send to the U.S. This puts India at a disadvantage compared to other countries, including China, which has lower tariff rates right now.
Many people are shocked by this new rise, given it was said that trade talks between the two countries were going quite well. Many people think that the U.S. move is a means to put pressure on India to agree to a trade deal and to respond to Trump’s criticism of India’s tariffs and trade with Russia.
The exact effects of the tariffs are still unknown, but experts say they might hurt a lot of Indian export sectors, like textiles, marine products, leather, and chemicals. The diplomatic fight and the trade problems that followed are a big threat to the long-term strategic cooperation between the U.S. and India.