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Tariff bomb may push India toward China

Tariff bomb may push India toward China

Last Updated Aug - 13 - 2025, 04:30 PM | Source : Fela News

Donald Trump’s move to impose a steep 50% tariff on Indian goods described as a “tariff bomb” may inadvertently drive India closer to China and other strategic
Tariff bomb may push India toward China
Tariff bomb may push India toward China

The hit of a 50% tariff bomb dropped by U.S. President Donald Trump on Indian imports has rattled New Delhi and sparked more than just economic alarm. Analysts warn that, rather than weakening ties, this aggressive trade action may unintentionally nudge India into deeper alignment with China and Russia a move that could shift regional dynamics significantly. 

India’s export sector is reeling. The surge to 50% in duties including the recent additional 25% threatens vital sectors like textiles, gems, and automotive components. The fallout is projected to shave up to 0.6 percentage points off GDP growth and squeeze competitiveness vis-à-vis peers like Vietnam and Thailand. 

Beyond economics, the geopolitical pivot is striking. India's move to pause U.S. defence contracts and explore deeper ties with Russia and China reflects the pressure of recalibrating its strategic partnerships. Duvvuri Subbarao, the former RBI governor, warns of a potential $7 trillion economic disruption due to these tariffs, alongside risks of market flooding from cheaper Chinese goods.

Although India’s central bank maintains a 6.5% growth projection, economists stress that current stability is fragile. Exporters urge swift trade negotiations and diplomatic response to counter the rising tide of protectionism.

In essence, what was intended as an economic weapon may backfire, accelerating India’s drift toward alternate global alliances and rewriting trade equations in the Indo-Pacific.

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