From Wednesday, the US will impose a heavy rate of 50% on certain Indian goods, the highest rate in Asia, as US President Donald Trump moves forward with the fines to punish New Delhi for the purchase of Russian oil. Here are the top ten updates: 1. The new rates will double the current 25% service on Indian exports, which began on August 7, which could further hinder the relationship between the two countries. Despite years of stronger economic and security ties, India and the US are now colliding amid Trump’s ongoing trade war, Bloomberg reports. 2. The White House announced the new rates in two notices issued on Monday and Tuesday at 12:01 in Washington (09:31 in New -Delhi). This indicates that India is unlikely to get any relief, especially as Trump’s efforts to mediate the Russia-Cukraine conflict remain to a standstill, according to the report. 3. The sharp tariff rate holds India, the world’s fastest growing major economy, at risk for a significant decline in trading with its largest export market. These levies in the jeopardy of India’s export competitiveness against competitors such as China and Vietnam jeopardize, which doubt Prime Minister Narendra Modi’s goals to develop the country into a major manufacturing power. 4. “This is a strategic shock that threatens India’s long-standing foothold in US labor-intensive markets, jeopardizing the risk of mass unemployment in export nets, and weakening India’s participation in global value chains,” New Delhi founder Ajay Srivastava said. 5. He added that competitors benefit, “which may close India from the most important markets, even after the rates have been rolled back.” 6. India was one of the first nations to start trade conversations with the Trump administration, but US negotiators became frustrated with India’s high rates and protectionist measures in sectors such as agriculture and dairy. Relations worsened after Trump criticized India for boughting Russian oil and accusing it funded Vladimir Putin’s war in Ukraine. In response, New -Delhi defended its purchases and said they help stabilize energy markets and that it will continue to buy Russian oil “based on financial benefits.” 7. The deteriorating relationship has led India to distance itself from the US and strengthen connections with other Brics countries. In recent months, Beijing and New -Delhi have worked to restore their tense ties to violent border clashes in 2020. Prime Minister Modi is expected to meet President Xi Jinping on the sidelines of a security summit in China next week, his first visit there in seven years. 8. At the same time, India and Russia promised to increase their annual trade over the next five years by 50% to $ 100 billion. New -Delhi hit a challenging tone and said it would continue to buy Russian oil, as long as it was financially viable. Since the full-scale invasion of Ukraine began in 2022, India has significantly increased its oil imports from Russia and is now about 37% of Russia’s oil exports, according to Kasatkin Consulting, Bloomberg reports. 9. Indian companies stopped their imports of Russian Oral Oil, in early August, but resumed the purchase in the weeks since. Meanwhile, a US trading delegation that visited India from August 25 to 29 for the sixth round of trade talks postponed its journey and doubts about whether the two countries can secure a trade agreement by the fall, a target set during Modi’s visit to the White House in February. Citigroup Inc. estimate that the new 50% rate of India’s annual GDP growth can reduce 0.6 to 0.8 percentage points. However, some large industries will be released. Electronic exports, which means that Apple Inc. new factory investments in India are not yet affected and will be saved, along with pharmaceutical exports, which are also excluded from the levies. It is a strategic shock that threatens India’s long -standing foothold in US labor -intensive markets. 10. The economic outage can be softened by the structure of the economy of India, which is mainly fueled by domestic demand rather than exports. With private consumption accounting for about 60% of GDP of India, the improvement of consumers and business confidence remains critical to accelerating growth. While the US is the largest export destination of India and received goods of $ 87.4 billion in 2024, this export represents only 2% of India’s total GDP. (With input from Bloomberg)
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