Govt Gives It Back To Donald Trump Over Tariffs, Says Will Take Necessary Steps To Secure Farmers, MSMEs And National Interests

The Government of India has taken note of a statement by the US President Donald Trump on bilateral trade, which imposes 25 per cent tariff on the south Asian nation with effect from August 1, as well as the unspecified penalty for purchasing oil and military equipment from Russia.

“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,” said the MInistry of Commerce and Industry. 

The central administration has attached the utmost importance to protecting and promoting the welfare of our farmers, entrepreneurs, and MSMEs, it said. 

The centre will take all steps necessary to secure our national interest, as has been the case with other trade agreements including the latest Comprehensive Economic and Trade Agreement with the UK, it added. 

India's response came soon after the two-time U.S. President Donald Trump imposed 25 per cent tariff on India, one per cent less than his Liberation Day tariff announcement. 

Taking to Truth Social, U.S. President Donald Trump said, "Remember, while India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country."

"Pointing out to India's dealings with Russia in terms of energy and military equipment, Trump mentioned, "Also, they have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of ENERGY, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE — ALL THINGS NOT GOOD! INDIA WILL THEREFORE BE PAYING A TARIFF OF 25%, PLUS A PENALTY FOR THE ABOVE, STARTING ON AUGUST FIRST. THANK YOU FOR YOUR ATTENTION TO THIS MATTER. MAGA!, " the post read. 

Also Read: Donald Trump Announces Tariffs, Penalty On India LIVE Updates

Meanwhile, the south Asian nation's top business association FICCI said, “”Disappointed by the decision taken by the U.S. to levy 25% tariff on exports from India and impose secondary sanctions. While this move is unfortunate and will have a clear bearing on our exports, we hope that this imposition of higher tariffs will be a short-term phenomenon and that a permanent trade deal between the two sides will be finalised soon." 

On the other hand, Nilesh Shah, MD at Kotak Mahindra AMC, said, “Despite the unpredictable policy making of the U.S., the market was expecting a tariff deal to work out as longer-term U.S.-India strategic interests are aligned. Markets will hope for a 'TACO' trade if better senses prevail.” 

"I hope and pray that this unilateral imposition should accelerate Indian policy making to be growth supportive. Our biggest deterrence continues to remain GDP size and competitiveness," he said. 

Sharing his analysis on Trump's latest tariff move, Aditya Nayar, Chief Economist at ICRA, said,"When the U.S. had initially imposed tariffs, we had lowered our forecast of India's GDP expansion to 6.2% for FY2026, presuming a tepid rise in exports and a delay in private capex. The tariff (and penalty) now proposed by the U.S. is higher than what we had anticipated, and is therefore likely to pose a headwind to India's GDP growth," citing a Reuters report. 

Speaking to reporters onboard Air Force One, Trump had also mentioned that, “I think the trade deals are working out very well. Hopefully for everybody, but for the United States, they're very, very good.” 

This still allows room for hopes to be pinned on a broader bilateral trade agreement between both countries.