India is considering imposing retaliatory tariffs on select American products after Washington levied steep 50% duties on steel, aluminium, and related exports from India, according to sources quoted by Hindustan Times.
If implemented, this would mark New Delhi’s first official countermeasure since US President Donald Trump announced a 25% tariff on all Indian goods on July 31, followed by additional penalties on August 6 over India’s Russian oil imports.
From Negotiations to Possible Trade War
The dispute began in February when the Trump administration imposed a 25% tariff on steel and aluminium. In June, the duty was doubled to 50%, impacting at least $7.6 billion worth of Indian exports.
India challenged the move at the World Trade Organization (WTO), arguing that the US was using “national security” as a cover for safeguard duties that breach WTO rules. With Washington refusing dialogue, India is now preparing legal grounds for proportional retaliation under WTO provisions.
“Washington is unwilling to address New Delhi’s concerns through talks, which leaves India with little choice but to retaliate,” a source told Hindustan Times.
Targeted Tariffs on US Goods
According to government insiders, India’s counter-tariffs could focus on a select list of US goods, with rates proportional to the losses caused by American levies.
Another senior official stated:
“The US is acting against India’s economic interests even as both sides are negotiating a trade deal. India reserves the right to respond to such unilateral and unreasonable actions.”
$131 Billion Trade Relationship at Risk
The US exports goods worth over $45 billion to India, while Indian exports to the US stood at $86 billion before the recent tariff hikes. The gap could widen if retaliatory measures go ahead.
Earlier this year, President Trump and Prime Minister Narendra Modi pledged to boost bilateral trade to $500 billion. However, talks stalled after the US demanded greater access to sensitive Indian markets, a request India rejected. The disagreement has been further complicated by Washington’s criticism of India’s Russian oil imports.
Trump’s Firm Stand
When asked about resuming trade negotiations, President Trump told reporters at the Oval Office:
“No, not until we get it resolved.”
Beyond Steel and Aluminium: Deep Economic Ties
The US exported $13.62 billion worth of energy to India in 2024–25, alongside major shipments of electronics, chemicals, and other goods. The services trade is also substantial, with bilateral services valued at $83.4 billion in 2024, giving the US a $102 million surplus.
US services exports to India rose nearly 16% to $41.8 billion in 2024, while imports from India climbed by a similar percentage to $41.6 billion.
