Excerpt: Trump’s 2025 tariff campaign marked a sharp turn in U.S.-India trade, with duties on Indian goods doubling in just four months.

In 2025, during his second presidency, Donald Trump imposed sweeping tariffs on India in a series of aggressive moves that escalated U.S.-India trade tensions to historic levels. Citing concerns over India’s trade practices and its continued purchases of Russian oil, the Trump administration rolled out three major tariff actions between April and August—raising import duties on Indian goods up to 50%. These tariffs hit critical sectors including textiles, electronics, jewellery, and auto parts, causing ripple effects in both countries’ economies.

Trump’s Tariff Actions on India (2025)

The first salvo came on April 2, 2025, when Trump launched a 27% “reciprocal tariff” on several Indian imports as part of a global “Liberation Day” trade policy ^[4]. This was followed by a 25% tariff announced on July 30, directly targeting India’s refusal to curb Russian energy imports ^[5].

The final escalation occurred on August 6, adding another 25% on top of the previous rate, effectively bringing tariffs on most Indian goods to 50% ^[6].

Sectors Most Affected by the Tariffs

The tariff waves were not evenly felt. While pharmaceuticals remained largely exempt due to their essential role in U.S. healthcare, almost every other major export category from India faced steep duties. These additional costs directly impacted U.S. importers, consumers, and Indian manufacturers alike.

Key Indian Export Categories Affected (2025)

Retailers warned that prices for consumer goods like smartphones, clothing, and jewellery could surge in U.S. markets, with some sectors like gems and jewellery seeing a +24% increase in retail price ^[7].

Geopolitical Dimensions

Trump’s rationale was not purely economic. The tariffs were directly linked to India’s ongoing energy and defense trade with Russia, which the U.S. viewed as a threat to NATO-aligned global security efforts. By economically pressuring India, the administration hoped to force a pivot in its foreign policy ^[8].

India, on the other hand, labeled the moves as “unfair, unjustified, and politically motivated,” threatening retaliation at the WTO and in its own trade policies ^[9].

A Historic Low in US-India Trade Relations

By August 2025, U.S.-India trade relations had reached a historic low. The 50% tariff wall on Indian exports created significant market disruptions and frayed one of the world’s most strategic partnerships. While pharmaceuticals were spared, consumer goods and industrial sectors were not, and the long-term consequences for global trade remain uncertain.

Excerpt: India’s trade footprint in the global market continues to evolve rapidly, driven by its strategic exports in energy, electronics, and IT services, while mineral fuels and high-tech goods dominate its import landscape. A deep dive into 2023 trade data reveals how India is positioning itself as both a critical manufacturing hub and a growing consumer economy.

India’s Global Trade in 2023: Goods and Services at a Glance

India’s engagement with global trade spans a diverse portfolio, from oil exports to digital services. In 2023, the country’s total merchandise exports reached $431.4 billion, while imports stood significantly higher at $672.1 billion, reflecting India’s expanding consumption base. On the services front, India’s dominance in the global IT sector remained evident, with total service exports worth $309.4 billion against imports of $176.8 billion.

Top Commodities Exported by India

India’s top ten exported goods reflect a blend of natural resources, high-value industrial products, and pharmaceuticals. Leading the list are:

• Mineral fuels and oils – $89.3 billion (20.7%)
• Precious stones and metals – $33.4 billion (7.7%)
• Electrical machinery – $32.3 billion (7.5%)
• Machinery and mechanical appliances – $29.3 billion (6.8%)
• Pharmaceutical products – $21.3 billion (4.9%)

These exports position India as a key global supplier in energy, technology, and health sectors^[10].

Top Goods Exported by India in 2023

India’s Major Imports: A Strong Energy Dependency

India’s reliance on global energy markets is evident, with mineral fuels and oils topping its imports at a staggering $220.6 billion, accounting for nearly one-third of total merchandise imports.Other notable import categories include:

• Electrical machinery – $76.1 billion
• Precious stones and metals – $72.7 billion
• Machinery and mechanical appliances – $57.1 billion
• Organic chemicals – $27.3 billion

Top Goods Imported by India in 2023

India’s Services Export Strength: Powered by IT and Business Services

In 2022, India exported over $309 billion worth of services, spearheaded by the booming IT and business services sectors. The country’s global leadership in software and back-office operations is underscored by:

• Telecommunications, computer, and information services – $144.8 billion (46.8%)
• Other business services – $74.9 billion (24.2%)
• Transport and travel services – combined $58.9 billion (19%)

India’s Imported Services: Business and Logistics Take the Lead

Service imports into India, totaling $176.8 billion in 2022, were largely centered around professional services, global transport logistics, and tourism^[11].Key imported services include:

• Other business services – $57.3 billion (32.4%)
• Transport – $43.5 billion (24.6%)
• Travel – $25.9 billion (14.6%)

Top Services Imported by India in 2022

Trade Trends and Strategic Insights

India’s trade data reveal several underlying economic dynamics:

• Energy security remains a critical concern, with high dependence on imported fossil fuels.
• Export strength is shifting from traditional commodities to high-value services, particularly IT and pharmaceuticals.
• India’s role in the global electronics and machinery supply chain is growing on both export and import fronts.
• Inward tourism and logistics spending reflect India’s increasing global integration and rising middle-class consumption.

Conclusion: The Road Ahead for India’s Trade

India’s evolving trade profile highlights a maturing economy—one that is leveraging its digital strengths while tackling structural import dependencies, especially in energy. As India positions itself for greater self-reliance and global leadership, strategic trade policy and investment in key sectors like renewable energy, technology, and services will be vital.

Excerpt: The United Kingdom’s trade relationship with India has gained momentum, reaching £42.6 billion over the latest four quarters to Q4 2024. This article unpacks the latest figures on exports, imports, market share, foreign direct investment, and India’s broader economic trajectory, offering context on what these numbers mean for businesses and policymakers.

UK–India Trade Overview

In the four quarters ending Q4 2024, total UK–India trade stood at £42.6 billion, marking an 8.3% uptick (£3.3 billion) compared to the same period a year earlier ^[12]

• Overall trade ranking: 11th among the UK’s global partners.
• Exports: £17.1 billion (+5.8% or £945 million), ranking 12th in export destinations.
• Imports: £25.5 billion (+10.1% or £2.3 billion), ranking 11th among import sources.

Goods vs Services: Export and Import Composition

India has become a vital market for both UK goods and services. Over the latest year:

• Goods exports: £7.0 billion (41.1% of total goods exports), up 15.4% (£938 million).
• Services exports: £10.1 billion (58.9% of total services exports), up marginally by 0.07% (£7 million).
• Goods imports: £10.8 billion (42.3% of total goods imports), up 3.0% (£314 million).
• Services imports: £14.7 billion (57.7% of total services imports), up 15.9% (£2.0 billion).

UK Market Share in India

The UK has expanded its footprint in India’s trade landscape in 2023, with market share rising across all categories ^[13]

UK Market Share in Indian Trade (2023)

Foreign Direct Investment Flows

Investment ties reflect a two-way flow:

• UK outward FDI stock in India: £17.4 billion at end‑2023, down 13.1% (£2.6 billion) from 2022.
• UK inward FDI stock from India: £13.1 billion at end‑2023, up 28.5% (£2.9 billion).

This divergence underscores evolving investment strategies, with UK firms recalibrating their allocation even as Indian investors increase their UK presence ^[14]

India’s Economic Outlook

India’s robust growth trajectory is pivotal for future UK–India trade dynamics. The latest projections for India’s GDP show sustained expansion:

India GDP Growth and Per Capita Projections

India’s global GDP rank is moving up, from 5th place in 2023–2024 to an anticipated 4th by 2025, reflecting the country’s increasing economic heft ^[15]

Implications for UK Businesses

• Diversify supply chains to capitalize on growing services demand in India.
• Monitor FDI trends to leverage inbound and outbound investment opportunities.
• Align with India’s growth sectors—notably technology and consumer services—to sustain export momentum.

Complete data sets underpinning these analyses are available from the respective statistical agencies.