Trump tariffs kick in: Pharma to refined petroleum fuels, 30% of Indian exports exempted

US President Donald Trump’s punitive tariffs on India are set to take effect today, meaning that most Indian goods exported to America will face 50 per cent duties. Earlier, the tariff had amounted to 25 per cent, but it was later raised to 50 per cent on India’s import of Russian oil.

The new duties will apply to goods entering the US for consumption or withdrawn from warehouses for consumption from 12:01 am EDT on Wednesday or 9:31 am IST, according to the Homeland Security notice.

On Tuesday, the Department of Homeland Security issued a notification laying down the details of the tariffs. The notification specifically targeted India and did not refer to China, despite Beijing importing more Russian oil than India.

However, approximately 30 per cent of India’s exports to the US, valued at $27.6 billion in 2024-25, will remain exempt from Trump’s tariffs.

Which sectors are exempted?

Pharmaceuticals account for around $12.7 billion worth of exports to the US. These face negligible tariffs currently, but there is a warning from Trump that tariffs could rise to 200 per cent if production does not shift to the US.

Electronics exports valued at $10.6 billion, which include smartphones, switching and routing equipment, integrated circuits, unmounted chips, wafers for diodes, and solid-state storage devices. However, Apple faces threats of tariffs if it continues exporting from India.

Apart from these, refined petroleum fuels and products, books, brochures, plastics, cellulose ethers, ferromanganese, ferrosilicon manganese, and ferrochromium, computing equipment such as motherboards and rack servers, will also be exempted.

Certain metals are exempt, including unwrought antimony, nickel, zinc, chromium, tungsten, platinum, palladium, dore gold, and gold coins.

Humanitarian donations and informational materials like books and films are also exempt.

Which sectors will be affected?

Nearly half of India’s exports, worth $87.3 billion, will be hit by the 50 per cent tariffs. The sectors that will be affected include textiles, apparel, gems and jewellery, seafood, leather goods, steel, aluminium, copper, organic chemicals and handicrafts.

Approximately 30 per cent of exports to the US, worth $27.6 billion in FY25, will remain duty-free, as categories such as pharmaceuticals, electronics, and petroleum products have been exempted from Trump’s tariffs. Meanwhile, around 4 per cent of exports, primarily auto parts, will be subject to a 25 per cent tariff.