US President Donald Trump has announced that a 25% tariff, along with an unspecified additional penalty, will be imposed on imports from India starting August 1, citing New Delhi’s continued purchases of Russian oil and military equipment, the BBC reported.

Making the announcement on his Truth Social platform, Trump criticised India’s high trade barriers and its defence and energy ties with Moscow, stating that such actions contradict global efforts to stop the war in Ukraine. He referred to India as a friend but reiterated that its tariff regime remains among the highest in the world.

The move revives tariff threats first made in April, when the US had announced duties of up to 27% on Indian goods. That proposal was paused to allow room for negotiations. With the August 1 deadline approaching, countries including India now face higher tariffs unless new trade agreements are reached, according to BBC.

The US has long targeted India’s import duties, especially on agricultural products and dairy, areas where Washington sees significant export potential. Previous US administrations have expressed frustration over India’s protective stance, while Trump has repeatedly branded India a “tariff king” and accused it of exploiting the US market.

India, in its initial response, said it was reviewing the implications of the US president’s remarks. The government reiterated its commitment to a fair and mutually beneficial trade deal, emphasising that the welfare of Indian farmers, entrepreneurs, and small businesses would remain central to any agreement. “The government will take all steps necessary to secure our national interest,” it said, BBC reported.

Negotiations between both sides have intensified since April, with mixed signals emerging. While US Trade Representative Jamieson Greer acknowledged that talks had been constructive, he also noted that India’s trade policy had historically been protectionist and focused on defending domestic markets.

Agriculture and dairy access continue to be major points of contention. The US has sought greater access to India's vast farm sector, while India has remained cautious, citing the need to protect food security and rural livelihoods.

Indian Commerce Minister Piyush Goyal recently reaffirmed India’s position, calling agriculture a sensitive sector and asserting that the interests of farmers would not be compromised. However, he also expressed optimism that a significant trade deal with the US could be finalised soon, saying talks were making “fantastic progress.”

Bilateral trade between the two countries reached $190bn in 2024, with the US being India’s largest trading partner until recently. Both Trump and Indian Prime Minister Narendra Modi have previously set an ambitious goal of pushing this figure to $500bn.

India has already lowered tariffs on certain US goods, including Bourbon whiskey and motorcycles. Yet, Washington continues to face a $45.8bn trade deficit with New Delhi—something the Trump administration appears determined to reduce with its latest tariff push.