Indian exporters have halted shipments to the United States and cancelled existing U.S. orders following the implementation of Trump's 50% tariffs on Indian goods, which took effect Aug. 27 at 12:01 a.m. EDT 
. The tariffs, which doubled from the previous 25% rate, now threaten $48.2 billion in Indian exports to America's largest trading partner 
.
Treasury Secretary Scott Bessent revealed that the punitive tariffs stem from two primary factors: India's continued purchases of Russian oil, which now accounts for 36-37% of India's crude imports, and prolonged trade negotiations that have failed to produce results 
. Bessent expressed frustration that early negotiations in March had raised American expectations for a quick deal by May or June, stating that India 'pushed us on the negotiation issue' while profiting from Russian oil imports .
The tariffs have prompted immediate economic disruption, with sectors such as textiles, seafood, and jewelry reporting cancelled orders as competitors like Bangladesh and Vietnam gain market share 
. Indian footwear entrepreneur Puran Dawar called the move 'an absolute setback,' warning that many small and medium enterprises could be excluded from the U.S. market . Analysts describe the 50% rate as effectively 'a commercial blockade' that could eliminate India's long-standing presence in U.S. markets .
In response to the escalating trade war, Prime Minister Narendra Modi is scheduled to travel to Beijing for the Shanghai Cooperation Organization summit, marking his first visit to China since 2018 
. Chinese Ambassador Xu Feihong said Beijing 'attaches great importance' to Modi's visit, noting that bilateral ties have 'returned to a steady path of development' . The Indian government is simultaneously pursuing trade diversification toward Brazil, China, Russia, Britain, Japan, Australia, and the European Union while preparing economic reforms including potential tax cuts before the Diwali holiday 
.
Despite the escalating tensions, both sides maintain cautious optimism for eventual resolution. U.S. National Economic Council Director Kevin Hassett warned that 'if the Indians don't budge, I don't think President Trump will,' while Treasury Secretary Bessent described the relationship as 'complicated' but expects the world's largest democracy and largest economy to 'come together' 
. However, Trump has reportedly made four unsuccessful attempts to contact Modi, and a planned U.S. commercial delegation visit to India has been postponed 
.
Indian exporters have halted shipments to the United States and cancelled existing U.S. orders following the implementation of Trump's 50% tariffs on Indian goods, which took effect Aug. 27 at 12:01 a.m. EDT . The tariffs, which doubled from the previous 25% rate, now threaten $48.2 billion in Indian exports to America's largest trading partner .
Treasury Secretary Scott Bessent revealed that the punitive tariffs stem from two primary factors: India's continued purchases of Russian oil, which now accounts for 36-37% of India's crude imports, and prolonged trade negotiations that have failed to produce results . Bessent expressed frustration that early negotiations in March had raised American expectations for a quick deal by May or June, stating that India 'pushed us on the negotiation issue' while profiting from Russian oil imports .
The tariffs have prompted immediate economic disruption, with sectors such as textiles, seafood, and jewelry reporting cancelled orders as competitors like Bangladesh and Vietnam gain market share . Indian footwear entrepreneur Puran Dawar called the move 'an absolute setback,' warning that many small and medium enterprises could be excluded from the U.S. market . Analysts describe the 50% rate as effectively 'a commercial blockade' that could eliminate India's long-standing presence in U.S. markets .
In response to the escalating trade war, Prime Minister Narendra Modi is scheduled to travel to Beijing for the Shanghai Cooperation Organization summit, marking his first visit to China since 2018 . Chinese Ambassador Xu Feihong said Beijing 'attaches great importance' to Modi's visit, noting that bilateral ties have 'returned to a steady path of development' . The Indian government is simultaneously pursuing trade diversification toward Brazil, China, Russia, Britain, Japan, Australia, and the European Union while preparing economic reforms including potential tax cuts before the Diwali holiday .
Despite the escalating tensions, both sides maintain cautious optimism for eventual resolution. U.S. National Economic Council Director Kevin Hassett warned that 'if the Indians don't budge, I don't think President Trump will,' while Treasury Secretary Bessent described the relationship as 'complicated' but expects the world's largest democracy and largest economy to 'come together' . However, Trump has reportedly made four unsuccessful attempts to contact Modi, and a planned U.S. commercial delegation visit to India has been postponed .
✅Neutral reporting,
based on 59 🗞 sources
