Trump's terrorism: 25% additional tariff on India, now what are the four possible paths? US President Donald Trump has imposed an additional 25% tariff on India in response to its purchase of oil from Russia, which will come into effect from August 27, 2025. This brings the total US tariff on India to 50%, making it the country with the highest tariff burden along with Brazil. This tariff will affect sectors like textiles, jewelry, leather, and chemicals in India. Let's know the brief details of this news and India's possible actions in the polite and eloquent style of Urdu literature. Background of the tariff The US imposed this additional tariff on India in response to its purchase of oil from Russia, which is part of Trump's strategy to punish countries trading with Russia in the context of the Russia-Ukraine war. India and the US had a trade deficit of $45.8 billion in 2024, and this tariff could increase it further. Pharmaceuticals and energy sectors have been exempted, but the impact on other sectors will be significant. Four possible steps for India to take: Seeking new markets: India is looking to expand its presence in regions like Europe, Southeast Asia, and Africa. It could seek a trading partner to reduce its dependence on the US market. This would help mitigate the impact of tariffs. New strategy with Russia: India could strengthen the rupee-ruble payment system with Russia or explore new sources of oil from Venezuela and African countries. Increasing domestic oil and gas production is also a solution, although logistical costs are a challenge. Retaliatory tariffs: If talks fail, India could impose retaliatory tariffs on US products such as agricultural goods, medicines, or technology, as it did on almonds, apples, and steel in 2019. Subsidies to domestic industries: India could mitigate the impact of tariffs by providing subsidies or incentives to its textiles, IT, and other industries, which would strengthen the domestic economy. “Strategy is the key to winning trade wars.” — An economist References CBS News, Business Standard, USA Today, France 24 Investopedia, X-Post
