Indian American business leaders Suresh U. Kumar and Rakesh Malhotra have criticized the Trump administration’s decision to impose a 25 percent tariff on Indian imports starting Aug.1, warning that the move could severely disrupt trade and strain diplomatic ties between the two countries.
Dr. Suresh U. Kumar, president of The Indus Entrepreneur (TiE) New Jersey, said in a statement that the decision—along with a separate penalty tied to India’s defense and energy dealings with Russia—could “have significant consequences, both for our bilateral trade and for the broader US-India relationship that has been carefully nurtured over the past several decades.”
He added that successive US presidents had worked “in a bipartisan manner” to strengthen ties with India, and that these tariffs could unravel decades of progress. Indian exports to the U.S. stood at $87.4 billion in 2024, spanning sectors such as pharmaceuticals, textiles, and smartphones.
“This new tariff threatens to undermine that progress,” Kumar said. “Indian businesses are bracing for immense disruption.” He cited industry leaders in India, like Kirit Bhansali of the Gem and Jewellery Export Promotion Council, who warned the tariff would “inflate costs, delay shipments, and distort prices,” putting thousands of jobs at risk—particularly for small artisans.
He also expressed concern that the move could derail an expected trade agreement later this year, warning that “the so-called ‘penalty’ on India’s defense and energy ties with Russia is unacceptable.”
“Just as India cannot dictate U.S. foreign policy, the U.S. should not dictate who a sovereign state chooses to engage with,” Kumar said. He added that unilateral actions like this “undermine a nation’s autonomy and sovereignty,” and could lead India to rethink its global alignments.
Kumar called on Indian Americans, including those who had supported Trump, to contact their representatives. “It’s crucial that we monitor these developments closely,” he said, urging the community to act.
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Rakesh Malhotra, president of the Global Indian Diaspora Foundation, also raised alarms about the trade fallout. He said that Trump’s sudden decision had “thrust American boardrooms into emergency strategy sessions.”
The tariff applies to a wide range of goods, including electronics, auto components, and textiles. “This is a gut punch to supply chain predictability,” said one unnamed executive, quoted by Malhotra.
Malhotra emphasized that the tariff could derail the fragile gains made as India becomes a core player in global manufacturing. “India is not just a back office anymore,” he said. “It’s increasingly core to design, manufacturing, and even our AI infrastructure.”
Retailers are reportedly preparing for cost hikes in electronics and apparel as India becomes a major alternative to China. “In 2025, the buzzword is ‘triage,’” said a Silicon Valley strategist cited by Malhotra.
He also noted that policy experts view this move as a pressure tactic ahead of a potential trade deal. “India is not out of step with WTO norms,” a trade lawyer said. “The current posture is more about leverage than legal standing.”
Malhotra pointed to the need for a strategic reset: companies must now reassess their India exposure, explore local production, and lobby for clarity. “This is not a full-blown trade war—yet,” he said. “But it’s a moment of reckoning.”
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