Coming into Effect! Major Uncertainty in US-India Tariffs! Indian Foreign Minister's Firm Stance

The prospects for US-India tariff negotiations are not optimistic!

In just a few days, the substantial additional tariffs imposed by the US on India will officially take effect. However, on August 23, the Indian Foreign Minister firmly stated that while trade negotiations with the US are ongoing, India has bottom lines that must be upheld. Previously, foreign media reported that a US trade negotiation delegation's scheduled visit to New Delhi from August 25 to 29 had been canceled, further dashing hopes that US tariffs on India might be reduced or delayed.

Amid increasing US tariff pressure, Indian Prime Minister Modi recently announced a reduction in the Goods and Services Tax (GST) on daily consumer goods to boost domestic demand in India.

However, due to tariff pressures, recent market expectations for the earnings of large and medium-sized Indian enterprises have been downgraded, and significant foreign capital has withdrawn from the Indian stock market. A survey released by Bank of America this month showed that about 30% of the fund managers interviewed had recently reduced their holdings of Indian stocks, making the Indian stock market the least favored among Asian markets.

US President Trump signed an executive order on August 6, imposing an additional 25% tariff on Indian products exported to the US, citing India's "direct or indirect import of Russian oil." This tariff is set to take effect on August 27. According to an executive order signed by Trump on July 31, the US began imposing a 25% tariff on Indian goods exported to the US starting August 7. When combined with the additional tariff announced on August 6, Indian goods exported to the US will generally be subject to a total tariff rate of 50%.