India’s Chief Economic Adviser V. Anantha Nageswaran has indicated that the ongoing tariff dispute with the United States may see resolution by 30 November 2025, with effective duties on Indian exports potentially reduced to 10-15%. At present, however, the combined tariff burden remains punitive: a baseline 25% levy imposed during Donald Trump’s earlier term, coupled with an additional 25% penalty tariff linked to India’s discounted Russian oil imports. Together, these have raised effective tariffs on key product categories to nearly 50%.
The impact has been immediate. Official trade data show that India’s exports to the U.S., traditionally its largest single market have been declining steadily for the last two months. Sectors such as textiles, gems and jewellery, and chemicals, which face the highest tariff incidence, have reported order cancellations and shrinking margins. This erosion of competitiveness has amplified calls within Indian industry for urgent de-escalation.
Negotiations and next round trade talks are currently underway, with U.S. trade officials in New Delhi and Commerce Minister Piyush Goyal signalling confidence that a deal could be concluded by November. Analysts caution, however, that while tariff moderation would relieve short-term pressure, the episode underscores the fragility of India’s trade reliance on the U.S., highlighting the need to diversify export markets and reduce vulnerability to sudden policy swings.
