How Trump’s trade policy could reshape India’s global economic ties

I believe India should not give in to President Trump’s aggressive trade tactics. On July 30, he imposed a 25% import tax on Indian goods entering the US starting August 1, 2025. Along with this, he even hinted at punishing India further for continuing to buy oil and weapons from Russia. This type of pressure is both unfair and unreasonable, especially for a country like India that has always tried to maintain a balanced foreign policy.

What’s even more concerning is that Trump hinted that the penalties could go up to 100% for countries like India, China, and Brazil. All this comes at a time when the trade between India and the US had reached $186 billion in 2024–25. India has a trade surplus of $44.4 billion with the US, but that doesn’t mean we’re doing anything wrong. The US has trade deficits with many countries, not just India. In fact, in 2023 alone, the US had a trade deficit of over $773 billion. So, targeting India specifically feels like political theatre more than sound economic policy.

Yes, Trump says his plan is to “Make America Great Again” (MAGA) by encouraging local manufacturing, but these import duties are already backfiring. Prices are going up in the US because fewer goods are being imported. This supply shortage is leading to inflation. So, in the end, it’s American consumers who are paying the price.

It’s also important to remember that Trump is known for backtracking. Many have even nicknamed him “TACO” — Trump Always Chickens Out — because of his habit of reversing decisions. So, it’s possible this 25% import duty might not last long. In fact, he has already made an exception for pharmaceutical imports from India. This shows that even Trump knows he cannot completely cut off essential supplies, especially in healthcare.

India must focus on self-interest and long-term gains

India needs to stay firm and think long term. This is not the first time global powers have tried to pressure us, and it won’t be the last. The best way to respond is to focus on “MIGA” — Make India Great Again. Instead of relying on exporting goods to countries that might change policies overnight, we should invite foreign companies, especially American ones, to set up manufacturing plants in India. Foreign Direct Investment (FDI) is more stable and beneficial than just exporting goods.

Countries like Japan and those in the EU have received lighter penalties from Trump — only 15% tariffs — because they promised more investments in the US. But many of these deals are unclear and full of confusion. For example, a supposed $550 billion investment promise from Japan is being questioned because of unclear terms and conditions.

The US only accounts for less than 3% of India’s overall trade. So, if we need to, we can reduce our reliance on them, even if that will take some time and effort. At the same time, we cannot stop buying oil and arms from Russia, which has been a reliable partner for decades. Our oil imports from Russia have gone from 3% before the Ukraine war to 36% now. Russia also allows India to pay in rupees, which helps us reduce our dependence on the US dollar.

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Trump also wants India to open its markets to US dairy products. But that would seriously hurt our farmers. In India, around 46% of the population works in agriculture, but they contribute only about 16% of the GDP. It would be cruel and risky to let them face competition from large-scale US farm products. We also have concerns about how American cows are fed — using slaughterhouse waste like bones and blood. That’s why India insists on feed certifications before allowing such imports.

History has shown us how dangerous it can be to depend on another country for essential items like food. During the Iraq war, the US blocked food supplies, even baby food, to force the Iraqi government to surrender. India cannot allow itself to be in a similar situation in the future.

In conclusion, India should not surrender to Trump’s pressure. His tariffs are more about political drama than economic sense. Our answer should be to grow stronger — not by picking fights, but by building a better economy that invites investment, protects our farmers, and doesn’t depend too heavily on any one country. We should think about Make India Great Again — MIGA — not just respond to MAGA. That is the smart and strong way forward.