Trump extends tariff on Chinese goods for another 90 days
In a move aimed at resolving trade differences, President Donald Trump has extended the tariff truce with China for another 90 days [1]. However, the current trade tensions between the U.S. and India have reached a boiling point, with both countries imposing steep tariffs and trade disruptions on each other.
The U.S. administration imposed 25% tariffs on Indian imports in early August 2025, which were later doubled to 50% by late August [2]. India retaliated by suspending all parcel services to the U.S. starting August 25, 2025 [2]. These measures have sharply escalated the dispute, straining a longstanding strategic partnership between the two countries.
India views the tariffs and U.S. pressure as unfair given the U.S.’ own imports of Russian goods and perceives them as infringing on its sovereign foreign policy choices, especially regarding its relations within BRICS and continued energy needs [3]. The potential impact on global economic growth is concerning, as the U.S. and India are significant global economic players, with India representing a critical emerging market and growth engine [4].
Tariffs and retaliatory trade disruptions threaten supply chains and reduce bilateral trade volumes. Rising trade conflict risks pushing India closer to U.S. strategic rivals China and Russia, potentially realigning global trade and geopolitical alliances in ways that could disadvantage U.S. interests and complicate global cooperation [4]. Increased protectionism amid existing global economic uncertainties could slow growth, disrupt investment flows, and dampen confidence in international trade frameworks [5].
The U.S. is not only escalating trade tensions with India but also with other countries like China, as part of its broader strategy to reshape global trade in favor of domestic manufacturing [6]. Trump seeks to reshape the global economy by bringing manufacturing back to the U.S. [6]. This strategy, however, comes with complex repercussions. While tariffs have brought short-term revenue gains for the U.S., they have also contributed to budgetary pressures. For instance, the U.S. budget deficit grew by 20% year-over-year as a result of the tariffs [7].
The complex repercussions of trade policies are highlighted by the contrast between the increase in customs revenue and the growth in the budget deficit [7]. The U.S. Treasury Secretary announced plans for diplomatic talks with Chinese officials to negotiate a more sustainable trade framework [8]. Markets showed initial optimism following the tariff truce extension, but many unresolved core issues remain, such as intellectual property rights and market access [9].
As the U.S.-India trade tensions continue, the global economic growth could be undermined by introducing volatility, reducing bilateral and regional trade, and exacerbating geopolitical rivalries that impact broader economic cooperation [1][3][4][5]. It is crucial for both nations to find a resolution to these trade disputes to ensure global economic stability and growth.
References:
- CNN
- Reuters
- The Hindu
- Bloomberg
- The Diplomat
- The Guardian
- Forbes
- CNBC
- Wall Street Journal
- The escalating trade tensions between the U.S. and India, marked by tariffs and retaliatory measures, are causing concerns in the realm of finance and business, potentially impacting global economic growth and stability.
- The U.S.' trade policies, particularly its tariffs on Indian imports, are sparking debates in politics and policy-and-legislation, as they are perceived by India as unfair and potentially infringing on its sovereign foreign policy choices.
- The ongoing trade disputes between the U.S. and India, and other nations, are creating uncertainties in general-news, as they could lead to realignments in global trade and geopolitical alliances, potentially disrupting international trade frameworks.
