U.S. President Donald Trump has escalated trade tensions by imposing a 50% tariff on Indian imports, citing India’s continued purchase of Russian oil amid the Ukraine conflict as a national security issue. The initial 25% tariff took effect on August 7, 2025, with an additional 25% tariff scheduled to begin on August 27. This move coincides with Trump’s warning that no further trade negotiations with India will occur until the tariff dispute is resolved. White House trade adviser Peter Navarro emphasized that India’s oil imports from Russia finance Moscow’s military operations against Ukraine, making the tariffs a strategic pressure tactic. In response, Prime Minister Narendra Modi convened a high-level Cabinet meeting on August 8 to formulate India’s strategic response and reassured that the country will prioritize its farmers’ welfare, prepared to bear economic consequences. The tariffs have led India to pause its plans to procure U.S. arms and aircraft, signaling strains in the carefully built U.S.-India partnership. Despite these challenges, India remains optimistic about finalizing a bilateral trade agreement during upcoming talks scheduled from August 25 to 30, while steadfastly protecting sensitive sectors like agriculture and dairy. Moody’s cautioned that India’s GDP growth could slow by about 0.3 percentage points due to the tariffs, though strong domestic demand and a resilient services sector may mitigate the impact. The ongoing dispute underscores the complex balance India seeks to maintain in its foreign policy and economic interests amid shifting geopolitical pressures.