Trump’s Tariff Move Jolts India Days After Trade Deal — Bangladesh Gets Zero Duty, India Faces 18%

A Trade Decision That Sparked Outrage

Just days after announcing progress on a trade understanding with India, US President Donald Trump has approved a tariff structure that has left New Delhi rattled. Under the new arrangement, textile imports from Bangladesh will reportedly enjoy zero tariff access to the US market, while Indian textile exports face duties of up to 18%.

The move has triggered sharp reactions across political and business circles in India.

Why the Timing Matters

The decision comes shortly after high-level trade engagements between Washington and New Delhi, where expectations were set for fairer market access and reciprocal benefits. The sudden tariff disparity has therefore been interpreted as a diplomatic setback for the government led by Narendra Modi.

Analysts say timing has amplified the sense of betrayal.

What the Tariff Gap Means

Textiles are one of India’s largest export sectors to the US, employing millions across the country. An 18% duty significantly affects price competitiveness, especially against rivals enjoying zero-duty access.

Bangladesh’s advantage could lead to order shifts and revenue losses for Indian manufacturers.

Why Bangladesh Got Preferential Treatment

US policymakers view Bangladesh as a low-cost manufacturing hub with strong dependence on textile exports. Granting tariff-free access is seen as part of Washington’s strategy to diversify supply chains and reduce reliance on a single production base.

India, by contrast, is being treated under a stricter reciprocal tariff framework.

India’s Strategic Discomfort

For New Delhi, the decision raises uncomfortable questions about the depth of US–India trade alignment. Despite strategic cooperation in defence and geopolitics, trade remains an area of friction.

Officials fear that such tariff moves undermine trust built through recent negotiations.

Impact on Indian Textile Industry

Exporters warn that higher tariffs could:

Reduce US-bound textile shipments
Pressure profit margins
Trigger job losses in labour-intensive clusters
Shift global buyers toward Bangladesh and Vietnam

Industry bodies are urging the government to seek immediate consultations.

Political Messaging vs Trade Reality

Trump’s trade approach has consistently prioritised American leverage over partnership optics. The tariff decision reflects his transactional style — rewarding perceived compliance and penalising sectors where the US seeks greater concessions.

Symbolism, experts say, rarely constrains tariff policy.

Diplomatic Options for India

India may raise the issue through bilateral trade channels or seek a review under existing trade mechanisms. There is also discussion around pushing for sector-specific relief rather than a broad renegotiation.

However, retaliation remains unlikely given larger strategic considerations.

Wider Regional Implications

The move sends a strong signal to other South Asian exporters about US trade priorities. Countries offering low-cost manufacturing and strategic supply-chain value may receive preferential treatment — even at the expense of larger partners.

This could reshape textile trade flows in the region.

What Comes Next

Trade experts expect behind-the-scenes negotiations rather than public escalation. India is likely to press for tariff parity or compensatory concessions in other sectors.

Whether Washington responds remains uncertain.

The Bottom Line

The US decision to grant zero tariff access to Bangladesh while imposing 18% duties on Indian textiles has exposed fault lines in India–US trade ties. Coming days after a trade deal announcement, the move has intensified debate over trust, reciprocity, and the real balance of power in bilateral economic relations.

For India’s textile sector, the impact could be immediate and hard to ignore.