India Evaluates US Tariff Effects Amid Strengthening Trade and Defense Relations
The Indian government is evaluating the impact of new US tariffs on its exports, which have been set at 25% on various goods, including steel and automobiles, affecting approximately USD 47.2 billion in trade. Despite these challenges, bilateral merchandise trade has increased to USD 94.44 billion from April to November 2025, as India seeks to enhance export competitiveness and strengthen trade and defense relations under the Comprehensive Global Strategic Partnership. Key areas of collaboration include defense, technology, and higher education, with significant engagement from both nations' leaders.
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The Indian government is assessing the implications of new US tariffs on Indian exports as trade and defense ties deepen under the Comprehensive Global Strategic Partnership. The US imposed reciprocal tariffs of 25% on Indian goods in July 2025 and an additional 25% on select exports in August 2025, affecting items such as steel, aluminum, and automobiles.
Approximately USD 47.2 billion of India's merchandise exports to the US are impacted by these tariffs. The government is consulting with exporters to mitigate the effects and enhance India's export competitiveness through various support measures.
Despite these challenges, bilateral merchandise trade grew to USD 94.44 billion from April to November 2025. Key areas of collaboration include defense, technology under the US-India TRUST initiative, and higher education, with over 353,000 Indian students in the US. Recent engagements include visits by Indian and US leaders to strengthen cooperation.
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