Indian exporters prepare for a strong fall in American orders after the failure of trade negotiations and confirmation by Washington of new high tariffs on the products of the country in southern Asia, which will enter into force as of Wednesday, which intensifies the tension between strategic partners.
An additional 25% tariff announced by President Donald Trump, confirmed on a notice of the National Security Department, raises total tariffs up to 50%, one of the highest in Washington, in retaliation for the increase in Russian oil purchases by New Delhi.
“The Government has no hope of immediate relief or a delay in American tariffs,” said an official of the Ministry of Commerce, who requested anonymity for not being authorized to speak with the media.
Exporters affected by tariffs would receive financial assistance and be encouraged to diversify to alternative markets such as China, Latin America and the Middle East, the official added.
The new tariffs will take effect from 00:01 EDT on Wednesday (09:31 IST). Exceptions are transit shipments, humanitarian aid and articles subject to reciprocal commercial programs.
You are interested: India and China work together to improve their ties for Trump’s unpredictability
The reasons why tariff negotiations failed
The Indian rupee fell to a minimum of three weeks of 87.68 against the dollar, despite recovering ground after the alleged intervention of the Central Bank to support it.
The reference stock market rates closed with a 1% decline each, registering their worst sessions in three months.
Wednesday’s tariff measure occurs after five rounds of failed negotiations, during which Indian officials were optimistic about the possibility of limiting tariffs to 15%.
The officials of both parties attributed the failure of the conversations between the first and fifth largest economy in the world, whose bilateral trade exceeds 190,000 million dollars, to political calculation errors and the lack of signals.
The White House commercial advisor, Peter Navarro, and the US Treasury Secretary Scott Besent, accused India of indirectly financing Russia’s war against Ukraine by increasing Russian oil purchases.
This month, Besent said that India was profiting with the drastic increase in its imports, which represent 42% of total oil purchases, compared to less than 1% before the war, a change that Washington has described as unacceptable.
India still did not issue any directive on the purchase of oil from Russia. Companies will continue to buy oil based on economic criteria, according to three sources in the refining sector.
With Reuters information
Subscribe to Forbes Mexico
