The Trump administration’s decision to double tariffs on Indian exports to 50 percent marks one of the sharpest blows to New Delhi in decades of bilateral trade. The move, justified by Washington as a response to India’s continued purchases of Russian crude, risks excluding Indian products from the U.S. market and weakening a partnership that has been carefully built over the past 25 years.
Speaking to Decode39, former Indian ambassador to Italy and current senior fellow at the Vivekananda International Foundation, Anil Wadhwa warned of the scale of the impact: “The additional 25% tariffs imposed by Trump, on top of the existing 25%, will end up excluding Indian products from the U.S. market. Since many of these are labor-intensive exports, the consequences will be layoffs, difficulties for the SME sector, and an unprecedented level of resentment against Trump and the United States.”
The ambassador also stressed that the political fallout could extend far beyond trade: “As a result, cooperation in numerous other sectors, painstakingly built up by both sides over the last 25 years, will also be undermined. India and Indians in general will begin to perceive the United States as an unreliable and undeserving partner. For a large market like India, already the world’s fourth-largest economy, this shift in perception will affect people-to-people ties, reducing the number of Indian students choosing the U.S. and tourists traveling there.”
According to Wadhwa, this situation is accelerating India’s willingness to diversify its partnerships. “India aims to fast-track negotiations on trade, investment and Geographical Indications (GI) with the European Union. India and the EU today share converging views on many dossiers, starting with their perception of the Chinese threat, and both have much to gain from bilateral cooperation.”
Italy, in particular, has re-emerged as a significant partner. “New agreements have been signed in the fields of migration and mobility, defense, innovation, space, science and technology, as well as trade and investment. India will now look at Italy with renewed interest. This is a favorable period for Indian and Italian businesses to start taking each other seriously again,” Wadhwa explained.
The tariff escalation also resonates with a wider geopolitical debate. As Vas Shenoy has noted in CNKY, the Russia-India-China (RIC) framework, first theorized by former Russian foreign minister Yevgeny Primakov, is once again resurfacing. While deep mistrust remains between India and China, Trump’s aggressive trade measures risk pushing New Delhi closer to Moscow and Beijing in tactical coordination, complicating U.S. efforts in the Indo-Pacific.
