Sri Lanka
USA
Canada
India
UK
UAE
India’s reaction to the U.S. slapping a 27% tariff on its imports is nothing short of wishful thinking wrapped in diplomatic spin. While New Delhi tries to sugarcoat the situation with talks of ‘studying opportunities’ and a ‘potential trade deal,’ the reality is that this is a clear-cut economic aggression by the Trump administration one that India is struggling to counter effectively.
The Indian government’s decision to maintain a “conciliatory” tone despite being singled out for punitive tariffs reflects a larger issue its inability to stand firm in trade negotiations. The tariffs, which were initially misreported by Trump as 26% but later clarified as 27%, are a direct blow to India’s exporters, who are already grappling with global economic uncertainty. The so called optimism about a future trade deal is nothing but an empty promise meant to pacify domestic criticism and create an illusion of control.
What’s more, the timing of this tariff imposition exposes the power imbalance between Washington and New Delhi. Trump’s move, which also included an aggressive 34% tariff on China and 46% on Vietnam, is a clear message India may be an ally, but not one worth exempting from his America first trade policy. The only reason India fared better than China and Vietnam is not because of any strategic consideration, but simply because Washington sees a lesser threat in its economic prowess.
While India’s trade ministry claims to be in discussions with exporters and industry leaders, the real question remains what concrete measures will be taken to counteract these tariffs? The government’s vague assurances of studying “opportunities” and holding talks offer little substance. Simply put, India has been caught off guard and is now scrambling to put together a response.
The financial markets may have reacted with relative calm Sensex and Nifty 50 dipped but not as drastically as their Asian counterparts. However, interpreting this as a sign of stability is naive. The rupee’s minor 0.08% rise is hardly a victory when viewed in the broader economic context.
New Delhi needs to wake up from its diplomatic slumber and realize that global trade is a ruthless battlefield. If India continues to play by Washington’s rules without asserting its own leverage, it risks being pushed further to the margins in the global economic order. A weak response today could set a dangerous precedent for future trade negotiations.
