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Trump’s 50% tariffs on India risk backfiring: U.S. growth to slow, inflation to rise
Trump’s 50% tariffs on Indian goods risk higher U.S. inflation, slower growth, and disrupted supply chains, echoing past protectionist failures.
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R Suryamurthy - Tue, 26, Aug 2025
- 12:43 EDT
- 59
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A 3D-printed miniature model of U.S. President Donald Trump, the Indian flag and the word / REUTERS/Dado Ruvic/Illustration
When President Donald Trump signed Executive Order 14329 earlier this month, doubling tariffs on Indian goods to 50 percent effective August 27, it was billed as a hard-nosed move to protect American manufacturers and workers. But economists now warn the policy could turn into a classic case of self-inflicted economic pain: slowing U.S. growth, raising inflation, and complicating the Federal Reserve’s already fraught battle to keep prices in check.
According to State Bank of India Research, the new duties on roughly $45 billion worth of Indian exports could shave 40–50 basis points off U.S. GDP growth while pushing inflation above target levels for an extended period. “This is effectively a tax on U.S. consumers and businesses,” said a trade economist. “It risks being a political win but an economic own goal.”
Also read: Trump claims economic come back, blasts media for fake inflation talk
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