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Trump Threatens India with "Penalty" On Top of 50% Tariffs over Trade with Russia
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TMTPOST --   U.S. President Donald   Trump   on Wednesday ramped up pressure on India   with an unspecified "penalty"   on top of hefty tariffs for   the   Asian economy ’ s surging   trade   with Russia, mainly for   purchases of sanctioned   Russian   oil.

Credit:China Central Television

  India will be   paying a tariff   of 25%   "plus   a   penalty   for the above",   starting   August 1,   Trump   announced   in a   social media   post.   The   president didn ’ t   offer   any clue   of the penalty, but attached India ’ s   trade barriers   and heavy   reliance   on Russian   energy   and military equipment.

India   is one of Russia ’ s largest buyers   of energy, and "they   have always   bought   a vast majority of   their military equipment from   Russia",   Trump posted on   his   platform Truth Social.   He also claimed India has implemented "far too high"   tariffs, "among   the highest   in the world,   and the country   has "the most strenuous and obnoxious non-monetary Trade Barriers of any Country."    He   stressed   in   another post that the   U.S. has   a massive trade deficit   with India.

The 50% tariff   rate is well above the 10% baseline tariffs that goods from most U.S. trading partners including South Korea have charged since April.   It is also   higher than the   tariff range that Trump   earlier this week   threatened   he would impose   if   India   fails to   reach a trade   deal   with   the U.S.   When asked by a reporter if India would pay tariffs of 20% to 25%, Trump said   on Tuesday, "Yeah, I think so.   India has been – they ’ re my friends."   

The White House   didn ’ t   specify the additional penalty   that   Trump   noted in his post. Trump ’ s top economic aide, National Economic Council Director Kevin Hassett on Wednesday   suggested   the president   felt   upset about the stalled   trade negotiations between U.S. and India, and he   wants the   country   to   open up its market.  

"I think President Trump is frustrated with the progress we ’ ve made with India but feels that a 25% tariff will address and remedy the situation in a way that ’ s good for the American people," Hassett said .   He   speculated the tariffs might the   Indian   government   to reconsider its   practices,   and Indians   "might even open their markets more to us so that we reconsider our future trades."

  India ’ s Ministry of Commerce and Industry   later Wednesday said   the government   is studying the implications of Trump ’ s tariff announcement.   "India and the US have been engaged in negotiations on concluding a fair, balanced and mutually beneficial bilateral trade agreement over the last few months," the ministry said in a statement. "We remain committed to that objective."

India   was one of the first   trading partners that start   negotiating with   the Trump administration.   Trump and his cabinet members had   repeated   they would make a deal with   India   soon, but the five   rounds of   talks so far have still failed to remove   all the hurdles.

India is bracing itself for higher U.S. tariffs, which will likely be between 20%-25% on some exports, as temporary measure, since it holds off   on fresh concessions by   August   1 and eyes   broader trade   deal   past the deadline, Reuters cited Indian government   officials   on   Tuesday.  

New Delhi reportedly plans to resume broader trade negotiations when a U.S. delegation visits in mid-August, with the goal of finalizing a comprehensive bilateral agreement by September or October.

Trump ’ s ability to secure commitments on market access for US producers has become a particularly salient fixation after U.S. reached tradeagreements with Japan and the European Union, which have emboldened the president as the August 1 deadline for reciprocal tariffs looms, CNN cited trade officials on Wednesday.

One of   the   officials said such fixation has created a significant obstacle to the prospects of   a deal   with   India.   "They ’ re willing to go part of the way," the official said. "But the president isn ’ t in a ‘ part of the way ’ mood – he wants barriers removed completely or as close to completely as possible."

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