Donald Trump announces 27 per cent reciprocal tariff on India

US President Donald delivers remarks on reciprocal tariffs during an event in the Rose Garden at the White House. PIC/AFP

The US has announced 27 per cent reciprocal tariffs on India saying New Delhi imposes high import duties on American goods, as the Donald Trump administration aims to reduce the country's trade deficit and boost manufacturing. The move is expected to impact India's exports to the US. However, experts say that India is better-placed than its competitors who also face more levies.

60 countries targeted

President Trump, in a historic measure to counter higher duties on American products imposed globally, announced reciprocal tariffs on about 60 countries. "This is Liberation Day, a long-awaited moment. April 2, 2025 will forever be remembered as the day American industry was reborn, the day America's destiny was reclaimed, and the day that we began to make America wealthy again. We are going to make it wealthy, good, and wealthy," Trump said in his remarks from the Rose Garden at the White House on Wednesday.

'US always pays more tariffs'

He said that the US charges other countries only a 2.4 per cent tariff on motorcycles, but Thailand and others are charging much higher rates, like 60 per cent, India 70 per cent, Vietnam 75 per cent, and others charge even higher rates. As he announced the tariffs, he held up a chart that showed tariffs that countries such as India, China, the UK, and the European Union charge, along with the reciprocal tariffs now levied on these countries.

'Friend not treating us right'

The chart indicated that India charged 52 per cent tariffs, including currency manipulation and trade barriers, and the US would now charge India a discounted reciprocal tariff of 26 per cent. But according to White House documents, there will be a 27 per cent duty on India.

"India, very, very tough. The prime minister is a great friend of mine, but I said, you're a friend of mine, but you're not treating us right. They charge us 52 per cent. We charge them almost nothing for years and years and decades, and it was only seven years ago, when I came in, that we started with China," Trump said.

World markets take a hit

Shares in Europe and Asia and US futures tumbled on Thursday The future for the S&P 500 dropped 3.1 per cent while that for the Dow Jones Industrial Average lost 2.6 per cent. Germany's DAX fell 1.7 per cent to 21,998.48, while the CAC 40 in Paris lost 1.8 per cent to 7716.66. Britain's FTSE 100 shed 1.2 per cent to 8506.44. In Asian trading, Tokyo's Nikkei 225 index dipped 4 per cent briefly, with automakers and banks taking big hits. It closed down 2.8 per cent at 34,735.93.

China vows countermeasures

China said it would adopt countermeasures after Trump imposed 34 per cent tariffs on its over $438 billion imports to America, the country's third largest export market, and urged Washington to immediately cancel these duties. "There is no winner in a trade war, and protectionism leads nowhere," said a spokesperson for the Ministry of Commerce.

'Major blow to world'

Trump's announcement of a new 20 per cent tariff on the EU drew a sharp rebuke from European Commission President Ursula von der Leyen. She said it was a major blow to the world economy and the consequences "will be dire for millions of people". Groceries, transport and medicines will cost more, she said, "and this is hurting, in particular, the most vulnerable citizens". Von der Leyen acknowledged that the world trading system has "serious deficiencies" and said the EU was ready to negotiate with the US but also was prepared to respond with counter measures.

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