India vows to protect farmers and businesses amid Trump's 25% tariff on Indian goods

By zoeysky // 2025-08-03

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President Donald Trump has announced a 25 percent tariff on Indian goods, escalating trade tensions. India vows to protect its farmers and businesses, refusing to sacrifice domestic interests for aggressive U.S. demands.
India's heavily protected farming sector (employing 40 percent of its workforce) is a major sticking point. The U.S. wants India to open its markets, but India fears that cheap American imports could harm its farmers.
Trump uses tariffs as leverage, accusing India of high trade barriers and buying Russian oil and military equipment. He hints at more penalties, framing tariffs as a way to benefit U.S. jobs.
India's rupee dropped after the announcement, raising concerns about economic instability. Opposition critics blame the government for failing to secure a better deal, while officials insist on protecting farmers and small businesses.
Negotiations aren't completely dead, but India may retaliate with its own tariffs or walk away. A resolution seems unlikely before the Aug. 1 deadline, risking long-term damage to U.S.-India trade relations.

India has pledged to take "all steps necessary" to shield its farmers and businesses after President Donald Trump announced a punishing 25 percent tariff on Indian goods, escalating tensions in already strained trade negotiations between the two nations. The move, set to take effect on Aug. 1, singles out India for harsher trade penalties than many of its peers. The new levies threaten to destabilize an economy that Washington has long viewed as a strategic counterweight to China. However, New Delhi has made it clear that it will not sacrifice its domestic interests, particularly its heavily protected agriculture sector, to appease U.S. demands. Trump's decision comes after months of stalled negotiations over a bilateral trade deal, with Washington pushing India to open its markets, especially in agriculture. Meanwhile, New Delhi resists – fearing a flood of cheap American imports could devastate its farmers. In a statement, India's Ministry of Commerce and Industry (MOCI) insisted it remains committed to a "fair, balanced and mutually beneficial" agreement. However, it emphasized that any deal must safeguard the livelihoods of millions of small farmers and businesses. The MOCI pointed to its recent free trade agreement with the U.K. as an example of its approach, one that prioritizes domestic concerns while engaging with global partners. But Trump, who has long viewed tariffs as a tool to strong-arm trading partners, seems unwilling to compromise. In a post on his Truth Social platform, he accused India of maintaining excessively high tariffs and continuing to buy Russian oil and military equipment. "While India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high," Trump wrote. He also announced an additional "penalty" on India for its energy and defense ties with Russia.

Farmers at the heart of the dispute

The biggest sticking point in negotiations has been agriculture, a sector that employs over 40 percent of India’s workforce and holds enormous political sway. Successive Indian governments have shielded farmers with subsidies and import restrictions, fearing that opening the market to U.S. agribusiness giants could trigger widespread rural distress. Trade Minister Piyush Goyal reiterated in Parliament that protecting farmers and small businesses is non-negotiable. "The government attaches the utmost importance to promoting the welfare of our farmers, entrepreneurs and MSMEs [micro, small and medium enterprises]," said Goyal. The opposition has seized on the issue, accusing the government of failing to secure a favorable deal and leaving the economy vulnerable. The rupee slumped following Trump’s announcement, reflecting market jitters over the potential economic fallout. This latest escalation fits Trump's broader trade strategy of using tariffs as leverage to extract concessions while framing them as a way to boost American jobs and offset budget deficits. Earlier this year, his administration imposed a 26 percent tariff on Indian goods as part of sweeping "Liberation Day" measures targeting multiple countries, though enforcement was delayed until Aug. 1. (Related: Health Ranger Report: Andy Schectman on Trump’s strategic moves and the looming financial shift.) Economists warn that such policies could backfire, driving up costs for U.S. consumers and businesses while sparking retaliatory measures. There are also concerns that more tariffs could follow, not just on India but on pharmaceuticals, semiconductors and other nations trading with Russia. Kevin Hassett, director of the White House National Economic Council, hinted that additional Russia-linked tariffs on India may be announced soon. Meanwhile, U.S. Treasury Secretary Scott Bessent expressed frustration with New Delhi, suggesting the ball is now in India's court to salvage a deal.

Will trade talks continue?

Despite the harsh rhetoric, negotiations haven't completely collapsed. Indian media reports suggest both sides were close to an interim agreement before Trump rejected it, deeming the terms insufficient. Former Indian Foreign Secretary Kanwal Sibal described Trump's approach as "pressure tactics." According to him, the real estate mogul had already pushed through what he called "one-sided deals with the EU and Japan. Sibal also disputed Trump's claim that the U.S. does "little" business with India. He pointed out that bilateral trade exceeded $132 billion last year, making Washington New Delhi’s largest trading partner. With the Aug. 1 deadline looming, India faces tough choices. It could retaliate with its own tariffs, risking further economic strain, or seek concessions to ease tensions. Either way, the Indian government’s priority remains clear – protecting its farmers and businesses, even if it means walking away from the negotiating table. Visit Trump.news for more stories about Trump's plans to boost the U.S. economy. Watch the Health Ranger Mike Adams and Andy Schectman discussing how Trump is going to collapse the dollar to save the bond market. This video is from the Health Ranger Report channel on Brighteon.com.

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Farmers at the heart of the dispute

Will trade talks continue?

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