NEW DELHI— With President Donald Trump expected to impose steep new tariffs on Indian imports later this month, foreign policy experts are cautioning that treating India as an economic rival rather than a strategic partner could undermine U.S. interests in Asia.
The proposed measures, set to take effect August 27, would raise duties on Indian goods to 50 percent — doubling an additional 25 percent levy already announced in July. Trump has justified the move by citing India’s continued purchase of Russian oil.
Analysts, however, argue that India’s energy decisions are guided by necessity rather than geopolitics. With many traditional suppliers redirecting crude oil to Europe, New Delhi has turned to discounted Russian barrels to secure affordable energy for its 1.4 billion citizens. India’s Ministry of External Affairs has emphasized that these imports are aimed at ensuring “predictable and affordable energy costs.”
A report from the Australian Institute of International Affairs (AIIA) warns that coercive trade actions could erode decades of trust between Washington and New Delhi and potentially push India closer to China. “India is not an economic adversary but a crucial strategic partner,” the report states, noting India’s central role in the U.S. Indo-Pacific strategy, the Quad security grouping, and counterterrorism cooperation.
The two countries have built closer ties over the past two decades, highlighted by the 2008 civil nuclear deal, growing defense collaboration, and robust trade. Bilateral goods trade reached $129 billion in 2024, with both sides aiming for $500 billion by 2030.
By contrast, experts point to the United Kingdom’s approach as a model of constructive engagement. On July 24, India and the UK signed a landmark Free Trade Agreement that eliminates tariffs on 99 percent of Indian exports, lowers duties on British products such as whisky and automobiles, and eases professional mobility. The agreement is expected to double trade between the two nations to $120 billion by 2030.
Despite the geopolitical concerns, ratings agency S&P Global has downplayed the immediate economic impact of Trump’s tariffs. At an August 13 webinar, S&P Director YeeFarn Phua noted that exports to the U.S. make up just 2 percent of India’s GDP and that key sectors like pharmaceuticals and consumer electronics are exempt from the new duties. “Over the longer term, we don’t think this will be a big hit on India’s economy, and therefore, the positive outlook on India remains,” Phua said. (Source: IANS)
