• Source:JND
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India is scrambling to formulate a diplomatic and economic response after US President Donald Trump announced a surprise 25 per cent tariff on goods imported from India, along with an additional penalty charge. The move caught New Delhi off guard and has triggered intense discussions within the government on how best to mitigate the fallout without escalating tensions further.

According to a report by Bloomberg, Indian officials are considering ramping up imports from the United States as a gesture of goodwill. These include purchases of natural gas, communication equipment, and gold. The aim is to reduce India’s trade surplus with the US over the next three to four years and keep bilateral trade negotiations on track. Defence purchases are off the table for now, the report added. 

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Government Issues Measured Response

In response to President Trump’s rhetoric, the Indian Ministry of Commerce and Industry issued a cautious and measured response. The ministry acknowledged the announcement and reiterated India’s commitment to negotiating a "fair, balanced, and mutually beneficial" trade agreement with the United States.

"The Government has taken note of a statement by the US President on bilateral trade. The Government is studying its implications. India and the US have been engaged in negotiations on concluding a fair, balanced and mutually beneficial bilateral trade agreement over the last few months. We remain committed to that objective," the ministry said in a statement on Wednesday evening.

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Avoiding Retaliation For Now

India has also ruled out an immediate tit-for-tat response, signalling its desire to maintain a stable economic and strategic relationship with its largest trading partner. US-India trade exceeded USD 129 billion in 2024, with strong cooperation across sectors like defence, technology, and energy, largely driven by a shared interest in counterbalancing China.

While India has faced criticism from US officials for its high tariffs and ongoing trade with Russia, especially in oil, the Modi government appears determined to prevent this latest friction from escalating into a full-blown trade war.