It has come into effect.. Washington imposes a 50% tariff on its imports from India

The significant increase in U.S. tariffs on Indian goods, approved by President Donald Trump to rise to 50%, came into effect on Wednesday, August 27, in a move expected to escalate tensions between the world's two largest democracies.

The activation of the decision followed five unsuccessful rounds of talks between the two countries, with U.S. officials showing no hope of avoiding the tariffs just hours before the implementation began. These punitive tariffs of 25%, imposed due to India's purchases of Russian oil, are added to previous tariffs of 25% on many Indian products, bringing the total to "50% on goods such as clothing, gemstones, jewelry, footwear, sporting goods, furniture, and chemicals".

These measures threaten thousands of small exporters and jobs in India, including in the state of Gujarat, the birthplace of Prime Minister Narendra Modi. Exporter groups estimate that the increases could affect nearly 55% of India's $87 billion goods exports to the United States, while benefiting competitors like Vietnam, Bangladesh, and China.

In response, an official from the Indian Ministry of Commerce, speaking on condition of anonymity, stated: "Exporters affected by the tariffs will receive financial assistance and will be encouraged to diversify their markets in places like China, Latin America, and the Middle East."

The U.S. Customs and Border Protection (CBP) granted shippers of Indian goods a three-week exemption for goods that "were loaded onto a vessel and en route to the United States before the midnight deadline," as they can still enter at the old tariff rates. Steel and aluminum products and their derivatives, passenger cars, and copper are exempt from this increase, as they are subject to separate tariffs under Section 232.

One reason for the dispute lies in the disparity in tariff rates. Indian Ministry of Commerce officials say that "the average tariff on U.S. imports is about 7.5%", while the U.S. Trade Representative's office highlighted "rates as high as 100% on cars, with an average tariff rate of 39% applied to U.S. agricultural goods."

This confrontation has raised questions about the broader relationship between the two countries, which are important security partners sharing concerns about China. However, the U.S. and Indian State Departments issued identical statements indicating that senior officials "met virtually on Monday and expressed their eagerness to continue strengthening bilateral relations," reaffirming their commitment to the "Quad" alliance, which also includes Australia and Japan.