- yesterday
US President Donald Trump has imposed a 25% tariff and additional penalties on India, citing high import duties, reliance on Russian military hardware, and energy imports.
Category
🗞
NewsTranscript
00:00Union Home Minister Ahmed Shah talking about Narendra Modi government's policies.
00:05He spoke of Operation Sindhur, he spoke of Operation Mahadev,
00:09he spoke of the tactics adopted by the Narendra Modi government
00:13to deal with the situation in Jammu and Kashmir.
00:16And then, of course, there was a lesson in history.
00:20The BJP has not spared a single opportunity to recount the mistakes that were made in the past.
00:28From 47-48, from the problem of Pakistan-occupied Jammu and Kashmir
00:33to China and Pakistan operating together
00:36to ceding 38,000 square kilometers of oxygen to China
00:41ahead of the 1962 India-China war and subsequently.
00:47But big statement.
00:48So it's curtains now on the Sindhur debate.
00:51The government emphatically making the point that India made,
00:55achieved all the goals of Operation Sindhur.
00:59Why Operation Sindhur was mounted?
01:02Of course, the opposition walked out in midst of the Union Home Minister's address
01:07in the upper house.
01:08Now, what were the objectives of Operation Sindhur?
01:11It was to teach Pakistan state-sponsored radical Islamist terror a lesson
01:16and target the nine terror bases.
01:18And the first time ever,
01:20Mureed K. and Bahawalpur,
01:22the headquarters of Lashkar-e-Taiba and Jaish-e-Muhammad,
01:26were bombed by the Indian Air Force.
01:28That had never been done before.
01:29The Indian Army acquired seven targets
01:31in Pakistan-occupied Jammu and Kashmir
01:33and in Pakistan's Punjab province.
01:36Now, Pakistan was told India does not want to escalate.
01:39When Pakistan tried to target Indian military and civilian installations,
01:45that's the time that India took out Pakistan's radar stations
01:48and very critical radar stations.
01:50The entire chronology,
01:52the entire history of Operation Sindhur
01:55and Operation Mahadev
01:57were given out by the Union Home Minister in his address
02:02in both houses of parliament.
02:04So you had the Union Home Minister,
02:05the Defence Minister,
02:06Prime Minister Narendra Modi spoke in Lok Sabha
02:09and now the government's made its point clear.
02:13The government insists it didn't buckle under pressure.
02:17There was no US pressure for a ceasefire.
02:20Repeatedly, this is a point that's being made
02:22by the Home Minister, Defence Minister
02:25and the External Affairs Minister.
02:26The External Affairs Minister in Rajya Sabha
02:29also made this very emphatic point.
02:32He, of course, hit out at what he called
02:35those who were China gurus,
02:36those who were telling India's longest-serving ambassador
02:40to China about China and Pakistan coming together.
02:45And he, tongue firmly in cheek,
02:48said he hadn't learned his diplomacy or foreign policy
02:52while going secretly for meetings in China
02:55or for the Olympic Games in China.
02:58So, barbs exchanged between the government and the opposition.
03:02But the point that government of India made,
03:04initially the aim was to hit out at terrorists.
03:07Then, when Pakistan tried to strike military installations,
03:10that's the time India went and hit
03:1211 Pakistani air bases
03:15from Skardu in Pakistan,
03:18occupied Jammu and Kashmir,
03:19through Noor Khan, Sargodha,
03:21Chaklala, Mushaf, Rafiki,
03:23Jacobabad, Bolari and the radar stations,
03:27including Malir Kant in Karachi,
03:29Chunyan, Pasroor, Sukur,
03:32all of them were targeted.
03:33Of course, Pakistan claims 18 Pakistani air bases
03:36and radar stations were targeted.
03:38India insists there were only 11-plus that were targeted.
03:42And this was the reason
03:44why Pakistan DGMO approached
03:47the Indian DGMO seeking ceasefire.
03:49Yes, there were calls
03:51and Prime Minister Narendra Modi
03:52emphatically gave details.
03:53U.S. Vice President J.D. Vance
03:55called the Prime Minister,
03:56called at least thrice or four times.
03:58The Prime Minister had to return his call
03:59because the Prime Minister
04:00was with the security forces.
04:02But when he returned his call,
04:03the Vice President cautioned India
04:05that Pakistan was about to mount
04:07a massive operation against India
04:09on the night of the 9th of May.
04:12And Prime Minister said,
04:14we will give them every answer
04:15from the call.
04:17And that's exactly what India did
04:19that was the reason government insists
04:21that Pakistan literally begged for peace.
04:26But then there is another issue here.
04:29We'll talk about that in greater detail.
04:32Beyond Operation Mahadev
04:33and beyond Operation Sindhuur,
04:35there's another challenge
04:36for the Narendra Modi government.
04:38And that challenge are the tariffs
04:40that are now being imposed
04:41by U.S. President Donald Trump.
04:44The U.S. President has announced
04:4525% tariff and penalties for India.
04:50He claims Indian tariffs
04:52are already too high,
04:54amongst the highest in the world.
04:55He's also alleged India
04:57has the most,
04:58as he puts it,
04:59strenuous and obnoxious
05:02non-monetary trade barriers
05:04of any country.
05:05But is this thing actually in the tail?
05:07Now, is this a part
05:08of America's coercive diplomacy
05:11or America's,
05:12U.S. President Donald Trump's
05:13coercive tactics?
05:15Because the U.S. does not want India
05:17to buy either Russian oil
05:19or Russian equipment,
05:21their military hardware.
05:22India has repeatedly insisted
05:24buying that discounted Russian oil
05:25is in Indian national interest,
05:27in the interest of Indian people.
05:29And the same goes for Russian weapons
05:30because historically,
05:32it's the United States and the West
05:33that sold weapons to Pakistan
05:35and not to India.
05:36But what do these tariffs mean
05:38for trade and ties
05:39between India and the United States?
05:42We'll get you more in this report.
05:44Your attention, please.
05:46Those of you that need translation
05:47of Prime Minister Modi's speech,
05:50please prepare your translation
05:51at this time.
05:53Dost, Donald has delivered a blow.
05:58Just days ahead of the August 1 deadline,
06:01U.S. President Donald Trump
06:02has imposed a 25% tariff
06:05on India,
06:06citing high import duties
06:07and what he calls
06:09obnoxious non-monetary trade barriers.
06:13But that's not all.
06:15He has also announced
06:16an additional penalty,
06:18blaming India's continued reliance
06:20on Russian military hardware
06:22and energy imports.
06:25In a fiery post on Truth Social,
06:28Trump wrote that India
06:29has some of the highest tariffs
06:31in the world
06:32and still buys weapons
06:34and oil from Russia,
06:36even as the world wants
06:38the war in Ukraine to end.
06:40Trump has often targeted
06:42India over trade.
06:43His tariff king,
06:44jibe at India,
06:45is well known.
06:48India has been a good friend,
06:49but India has charged basically
06:52more tariffs than almost any other country.
06:56Back home,
06:57the move has triggered
06:58a political slugfest.
07:00The Congress was quick to hit out,
07:02calling the tariffs a result
07:04of the tariff of Howdy Modi.
07:07They allege
07:08that Modi's silence
07:10on a series of earlier US provocations,
07:14including Operation Sindur disclosures,
07:17Pakistani army outreach
07:18and IMF support to Islamabad
07:21has only emboldened Trump.
07:24They are now urging him
07:26to take a firmer line,
07:28like Indira Gandhi.
07:31Several opposition parties
07:33are also sharpening their criticism,
07:35accusing the Modi government
07:37of being diplomatically outplayed.
07:39He is a very strong
07:40of the government.
07:41I want to say,
07:42that the government
07:43should address the authorities
07:44to the authorities.
07:46And the government
07:46should give a witness.
07:48You are not in the government,
07:50yesterday, yesterday.
07:51We are not in the government.
07:51We are not in the government.
07:52What will it be the country?
07:53But this country will still be,
07:55but this country will be.
07:57Do not let this country
07:58do not harm harm.
07:59It is not harm to this country.
08:01It is a very poor
08:02expression.
08:04It is a tariff and then penalty.
08:07The BJP meanwhile is striking a measured tone, saying the government will respond wisely
08:18and is hopeful the US will reconsider.
08:24External Affairs Minister Jaishankar shared a key meet with Commerce Minister Piyush Goyal
08:30after the announcement.
08:31We'll talk about the timing.
08:49As India and US space agencies celebrate the success of Nisar's launch, Donald Trump has
08:56dropped a tariff bombshell.
09:00Has India been trumped or does the Modi government have a trump card that Donald has not bargained
09:06for?
09:09Bureau Report, India Today.
09:11And we are getting the first response of the Narendra Modi government.
09:23The government, we are told, has taken note of the statement by the US President on bilateral
09:28trade.
09:29The government is studying its implications.
09:31India and the US have been engaged in negotiations on concluding, and this is significant, fair,
09:37balanced and mutually beneficial bilateral trade agreement over the last few months.
09:41And we remain committed to that objective.
09:44I quickly want to bring in India Today's Aishwarya Paliwal for more on this.
09:47Aishwarya, five rounds have already happened.
09:50Apparently, end August, there's another round.
09:57Donald Trump talks about 25% tariffs, coercive tactics.
10:04Yes, definitely.
10:05You know, you've spoken with a lot of people here in Parliament with the government also,
10:09and all of them at the moment believe that these are just tactics.
10:12These are just arm twisting tactics which are being deployed by the US President Donald
10:16Trump.
10:17As the government has also set out in the first statement which is coming out, the implications
10:21are at the moment being studied.
10:22What is it that India can actually do?
10:24That's also something which is now being very closely looked at.
10:27Expect something coming in from the Indian government, especially from the Commerce Ministry
10:30in the next 24 hours.
10:31Because that's all is something that the government at the moment is looking at.
10:35What will be the implication of these things?
10:37And how will India make sure that it protects itself?
10:40Because that is something that the Indian government has been very, very clear about.
10:44And that's the reason why you are seeing such tug of war taking place.
10:47If India would have actually agreed on to the terms of Donald Trump, then we would not
10:51have seen these kind of statements coming in.
10:53So on one side, one thing that is very clear, Gaurav, is the fact that the Indian government
10:56is not backing down.
10:58And that's the reason why we are seeing this statement coming in from the US President
11:01Donald Trump.
11:02For India to back down on anything, it has to be win-win for both.
11:06Aishwarya, for the moment, many thanks for joining me.
11:09Joining me for more on the implications of this 25% tariff and penalty on Indian exports
11:13to the US.
11:14Siddharth Zarabi's group editor of Business Today joins us in a moment.
11:18Shankar Iyer is one of India's finest political economy analysts and author.
11:23Joins me on this show.
11:25S.C. Garg is former Finance and Economic Affairs Secretary, Government of India.
11:29Again, a published author joins me on this show.
11:31Shankar Iyer, let me begin by asking you your appreciation of these tariffs that have just
11:37been announced by President Trump and White House saying that he's frustrated.
11:42He's frustrated by the slow pace of negotiations.
11:45Does that openly indicate that these are pressure tactics that America is mounting on India?
11:50Well, very clearly, Gaurav, these are coercive tactics, pressure tactics.
11:55Mr. Trump is not known to be subtle about anything.
12:00You know, you have a declaration that India and US trade teams are going to meet later in August.
12:07And then you have the announcement that there are tariffs.
12:09The hypocrisies of US foreign policy are not a mystery or a secret.
12:16So, I mean, you know, Trump wants things done.
12:19He wants a reset in headlines.
12:21He wants to be seen to be winning.
12:24But the same frustration he doesn't seem to have with China, where the discussions have been going on longer.
12:35And that is because China has got them by the dependencies that they have created.
12:43All powerful people and countries have dependencies, are dependent.
12:49And it is up to India to find out what dependencies we can leverage.
12:54And we have to create those dependencies.
12:57This 35% tariff regime is simply unsustainable for India.
13:04It's unsustainable for India because if you're looking at China plus one when it comes to production,
13:08will we remain a viable market?
13:10Edward Luce, US national editor, and Columbus Financial Times joins me, Siddharth Zarabi, with me on this broadcast.
13:17Siddharth, your appreciation of what the US is doing.
13:20Are they, one, pressure, negotiate a trade deal at America's interest, not a win-win, but only win for America, 0.1, 0.2.
13:29Are they truly thinking that India will stop buying Russian oil or Russian weapons?
13:33Copybook Trump negotiation tactics?
13:35Put the adversary under pressure or the other side under pressure?
13:39Gaurav, before I answer that, I just want to take you through a very measured statement
13:44that's just come out minutes ago from the Government of India.
13:47This is a statement posted by the Press Information Bureau,
13:50which says that the Government of India has taken note of the President's statement on bilateral trade
13:56and is studying its implications.
13:58What's important to note here is that the government says,
14:01we remain committed to the objective of concluding a fair, balanced, and mutually beneficial bilateral trade agreement
14:10that's been negotiated for the past few months.
14:13It goes on to say that the government attaches the utmost importance to protecting,
14:17and this is the most crucial part, Gaurav,
14:19for promoting the welfare of our farmers, entrepreneurs, and medium and small enterprises.
14:26The government will take all steps necessary to secure national interest, as has been the case with other trade agreements,
14:34including the one with the UK.
14:36Gaurav, very clearly, this first immediate response makes it clear there is no backing down.
14:43Of course, India has wanted a trade deal and was amongst the most serious participants in a detailed negotiation and engagement with the United States.
14:55I think, despite the provocation of bringing in Russian oil purchases at this stage,
15:02and remember Senator Lindsey Graham's 100% tariff set and absolutely shocking use of language,
15:09the Government of India is not responding to that, not getting provoked by that.
15:13And very clearly, the penalty amount over and about 25% is something that could dampen negotiations,
15:21but we remain hopeful at this stage, if you go by this statement.
15:25Sure, but does that language actually make India seem either weak or subservient?
15:31And being polite often, especially in the West, or is it seen as weakness, which truly actually means real strength?
15:38But Edward Luce, you've just put out a message, sir, on social media platform X saying,
15:43Trump's 25% India tariff is obnoxious and yet another gift to China.
15:50He's punishing poorer countries more than the richer ones and alienating the global south.
15:56Stupidity, as you write, does not cover the damage Trump is doing.
16:01Sir, explain why you believe Donald Trump's actions, in your words, are stupid,
16:06and are they counterproductive?
16:09Well, Donald Trump, you know, pays no attention in terms of trade war to whether you're a friend or a foe.
16:17And in fact, he's actually a lot kinder to foes.
16:21He's made some serious concessions to China in the last few days,
16:27because China has, I guess, a stranglehold on critical minerals and rare earths, and he wants to get those coming back to the United States.
16:38So the alienation that I think these kinds of escalatory and quite extreme threats create in capitals such as New Delhi is, from a geostrategic point of view, stupid.
16:55But from an economic point of view, I mean, I would agree with your panelists.
16:59He's escalating in order to get submission, and he has had a lot of submissions recently.
17:06The European Union really bended the knee to him with their deal with Trump earlier this week.
17:14You've seen a pretty soft deal that Japan agreed to, not favorable to Japan.
17:21But the worst ones are with developing countries, with Vietnam and with Indonesia.
17:27Those are the ones that have been punished the most.
17:29It's the rich countries that are getting off the lightest.
17:32So, you know, I think if there's a strategy to compete with China globally and win the hearts and minds of the Global South, of which India is the most important piece,
17:43then, sorry to be blunt, but the word I would use is stupid.
17:48Okay.
17:49Mr. Garg, in your appreciation, you've seen how he's reacting to India.
17:55You've seen the way he's reacting to other developing countries.
17:58You've seen how he's reacted to a country who's supposed to be very close to him, Japan.
18:02And how he's reacting to a country like China that pushes back.
18:05What's your appreciation?
18:07How should India react to ensure Trump does not think that he'll get away with his bullying tactics?
18:13So, in my judgment, for Trump, whether you are a friend or a foe doesn't matter.
18:21What matters is whether he's getting the deal which he wants.
18:25And, therefore, if India is not offering a deal which he wants, he will put the tariffs.
18:32That's understandable.
18:34I don't think we should be surprised.
18:37It's going on for the last four months.
18:39It's not new.
18:41On 4th April, he said 26%.
18:44What has come now is 25%.
18:47So, it's nothing new.
18:49I don't know why Indian establishment need to study the order which has come today.
18:56In fact, it has come with something more than that 26%, which was threatened on 4th April.
19:04Now you have penal tariffs on, and that's not specified as yet.
19:10You have been sort of told not to buy oil from Russia.
19:15And that may perhaps decide what kind of penal tariffs might again be imposed.
19:22I think it makes a very simple sense that doing business with the United States on the terms which America is offering is not possible any longer.
19:37Okay.
19:38And that's what's going on for, rather than trying to get into negotiations.
19:43Because what kind of negotiations?
19:45You may say that reduce 25% to 15%.
19:50He might even agree to that.
19:53Would you be able to provide sort of what he wants on agriculture tariffs?
19:58Would you be able to provide on whether you would be able to buy the aircrafts, the energy and other things from them?
20:08It's not possible.
20:10Would you be able to stop your oil purchases from America, from Russia?
20:16From Russia.
20:17So, this deal with America is an impossible deal.
20:22Has he set it up to be impossible or his prima facie looks impossible, Shankar Iyer?
20:28He's thinking of, you know, show them the impossible, give a little and then India will accept whatever he gives.
20:35Except that either on oil or on weapons from Russia or on agriculture or on dairy, there is no way that any establishment in India,
20:44any government in India, let alone a government like Narendra Modi's government, can they expect to give anything to America on any of these fronts, sir?
20:54Well, Gaurav, as I said earlier, this is not coercive tactics. This is plain, simple bullying by a $30 trillion economy trying to get a $4 trillion economy punished.
21:07Now, there are, nobody has accused the United States of being, you know, long on any strategic vision. I mean, there's this country which is wanting India to be kind of a balanced track.
21:22No, they want India to be like the counterbalance to China. We have 1.4 billion people, so they want us to be part of Quad and stuff like that. And then you go and hammer the same country.
21:35The government may have a legitimate reason to want India to buy stuff from America. But here are the things that I want to place on record. Here is a country which calls itself the leader of the free world, but wants to dictate terms on what a country of the size and scale of India, how, what, where they will buy their goods from.
22:02The second part is, the hypocrisy is completely unbelievable. I mean, till 2016, US had imposed a ban on LNG exports to other countries. Till 2023, Europe was buying $700 billion worth of oil and gas from Russia.
22:23Even today, even today, American corporations are situated in Russia. So what is it that he's trying to tell us? I mean, if US wants India to buy arms and then tell us who the rifles will point out of where the jets can be used, these are all things that have been discussed earlier.
22:44There is nothing new in this platform. And we have discussed this for four months. Where India has sort of stumbled is that they mistook personality for policy.
22:56And they mistook the idea of his definition of friendship with our definition of friendship. His definition of friendship is me, me, me.
23:06And India has been sort of dragged into a corner now. So we have to find ways to do it. While I'm at it, we are here. A simple formula to understand the impact of tariff is, what do we give to the PLI producers?
23:22That is, sir, relief. If we measure the tariffs, how many times that PLI will have to be increased?
23:30We have simply no place to deal with this kind of obnoxious trade negotiations.
23:37Okay. Edward, just give me a moment. Siddharth Sarabi wants to come in and I'm just coming to you in a moment.
23:42Siddharth, both India and the United States have completed five rounds of negotiations. The sixth scheduled for around 25th of August.
23:49One of the key sticking points, we were told, is India doesn't want to permit genetically modified crops and American dairy products.
23:57Given the political sensitivities, the economic sensitivities in India's agriculture and dairy sector.
24:03So, is there forward movement possible here? Or that's India's red line? Not negotiable.
24:10Gaurav, as of last week, very credible and well-connected sources in the United States had told me, and we had reported that across our platforms, that the file of the proposal was on President Trump's desk.
24:27But look at what has happened today. And I am going to say this, just adding to what Edward said earlier, that there is no logic, there is no rationale, and there is certainly no mathematics behind what has happened today.
24:42Pre-April 2, the tariffs on US imports from India were 2.7%. This is the trade-weighted average in percentage terms. It went up to 11.6%. And post the 1st of August, it goes up to 25%.
24:5825%. We don't know whether he'll go with the linsegram 100%. Yes. Or he will use the BRICS 10% slab that he himself has announced. That has added uncertainty to Indian exporters. We've been speaking to some of them over the past couple of hours, and they say that it's tough to give a firm response.
25:16But one very quick point. What was therefore the consequence of the current tariffs? Currently, US tariffs on goods imported from India are higher than what we impose.
25:28And I will just leave one final thought. It's not as if India does not have options. There's a lot of chatter about India not responding forcefully and all of that. I think that is complete humbug. Please remember that this is a goods-related conversation.
25:45What about services? 25 billion dollars or thereabouts that US tech majors take away every year from India. The billions of dollars, again in the same range that Indian students invest to study in the United States, that far outweighs the trade deficit that President Trump is going on and on and on about.
26:05Edward Luce, the last 30 seconds I have on this part of the show, my apologies. US seems to be putting pressure on India even to stop buying Russian oil, reduce dependence on Russian weapons and systems. Both are very important for India.
26:17Is that a win-win possible or is this now a lose-lose because of Trump's tactics?
26:24Look, all trade deals, regardless of who they're with and at what level they're applied, are lose-lose because this reduces openness to trade and therefore reduces efficiency.
26:38I think that probably Trump is trying to bully India into making more concessions. Concessions, I doubt that it can make in terms of agriculture. It's just too politically suicidal.
26:51But, you know, if he sticks to this number and a deal doesn't get arrived at the 25 percent number, if he sticks to that, then, you know, people who are producing iPhones in Chennai and elsewhere in India's South are going to have to start looking again at the economics of that.
27:10So it could be really, really bad for India if he if he means this and that and if this isn't bluff, which it could well be. We're talking about Trump after all.
27:20Oh, absolutely. So let's wait and watch and let's keep our powder dry. Sorry, I've run out of time on this part of the show, but this is a debate we'll have perhaps several times over the next days and weeks as we look at Trump tariffs and coercion.