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Earlier, Tesla was reported to be in the Indian market by October 2021. However, this could not happen. Trump said a few months later that Tesla’s entry in the Indian market stopped due to high tariff duty.
Date 25 November
Place-Mar-e-Lago, Florida
Just 20 days after the victory in the presidential election, Trump announced that he would impose 25% tariffs on Canada-Mexico and 10% on China as soon as he takes the oath. The currency of these countries had declined since this announcement of Trump.
Trump did the same after taking oath on 20 January. He issued executive orders for this. However, Trump, after accepting the conditions, postponed the tariffs on Canada and Mexico for 30 days. Tariff has come into force on China from 4 February.
Trump is also very aggressive about tariffs even in his second term. They are using it from other countries to get their terms to celebrate their terms. Trump’s tariff threatened countries include India, Brazil and European Unions.
After assuming office on January 20, Trump issued an executive order related to the tariff.
In this story, what is the tariff that the countries of the world are worried about and why Trump is so aggressive about it. What will be the effect on India if it has a tariff…
In simple words, tariff is a tax imposed on goods coming from another country. This tax is levied on the importing company.
For example, a company is importing a car worth Rs 10 lakh to India. If India has put a tariff of 25% on it, then that company will have to pay a tax of Rs 2.25 lakh to the Government of India on every car. That is, the car will be 12.25 lakhs by coming to India.
Why is Trump so aggressive on tariffs?
The biggest reason for Trump’s becoming aggressive about tariffs is to reduce America’s trade deficit. Trump is taking this step to correct the good of American companies and to correct trade imbalances from countries around the world.
In 2023, the US suffered 30.2% from China, 19% from Mexico and 14.5% from Canada. Overall, these three countries are responsible for the US dollars of $ 670 billion, or about 40 lakh crore rupees in 2023. This is the reason why Trump first imposed tariffs on these countries.
What are the benefits of applying tariffs?
Actually, tariffs have two advantages. First, this gives the government revenue. The second country companies are able to compete with foreign companies. For example, Chinese companies make mobile phones. This company arrives in America to sell its phones.
But in America too many companies make phones. American companies will suffer if the Chinese company starts selling its cheap and attractive phones there. Along with this, the revenue of the government will also be affected.
In such a situation, the government will impose tariffs to achieve revenue and save domestic companies. By applying the tariff, Chinese phones will become expensive and the phone -making American companies will be able to compete with them.
India among the most tariffs on American products
India has been one of the most tariffs. According to a report by Indian Express, the average tariff in India was up to 125% by 1990-91. After liberalization it went down. India’s average tariff rate was 11.66 % in 2024.
After Trump became President again, the Government of India changed the tariff rate. According to The Hindu report, the Government of India has abolished 150%, 125% and 100% rates of tariffs. Now India has the highest tariff rate of 70%. India had 125% tariff on a luxury car, now it has been reduced to 70%. In such a situation, in the year 2025, India’s average tariff rate has come down to 10.65%.
All countries usually impose tariffs. In a country, its rate can be low and some can be higher in some. However, compared to other countries, India is one of the highest tariffs.
Does India benefit from tariffs on countries like China, Canada
Experts believe that putting tariffs on Chinese products will increase the sales of Indian goods in the US market. According to an analysis by Oxford Economics, when the tariff war started with China in Trump’s first term, India was at number four among the countries that got business benefits.
Director General of Federation of Indian Export Organization (FIEO) Ajay Sahai said, “The tariff of America will affect China and its business ally like South Korea and Japan, but India will benefit from it, because it will benefit India, because it will benefit it in the US market Companies of countries like China will get less competition. Apart from this, companies who have factories both in both China and India will start getting more orders in India.
India protected from Trump’s tariff action
After taking oath, Trump has imposed on Canada, Mexico, Colombia and China (Trump has removed tariffs on other countries other than China). However, so far India Trump’s tariff action has survived. India has started reducing tariffs on many American goods to avoid Trump’s tariff.
In the budget presented on 1 February, India has reduced taxes on goods such as goods from US-less engine, ground installation for satellite and synthetic flaving essence for satellite.
What is the reciperook tariff plan that will work on the lines of Tit
Trump has announced to put a Tit tariff to the reciperook tariff. Trump said that the country which puts tariffs on American goods, America will also put the same tariff on the goods of that country. The US President has also said that the recipe -rocke tariff will be announced on Tuesday or Wednesday and will be implemented immediately. This tariff will apply to every country.
If India has a reciperook tariff, what will be affected on exports?
If the US increases the tariff on India, it will harm. India does more than 17% of foreign trade with America. America is the largest buyer of India’s agricultural products such as fruits and vegetables. In 2024, the US also imported 18 million tonnes of rice from India.
If the US puts tariffs on India, then Indian products will start selling expensive in American markets. This will reduce their demand among the American public.
Will Tesla be exempted from Tesla’s entry in India instead of tariffs
According to the BBC, Ellon Musk started the process of registration of Tesla Company in Bangalore in January 2021. She then announced that Tesla would take an entry in the Indian market by October 2021. However, this could not happen. Trump said a few months later that Tesla’s entry in the Indian market has stopped due to high tariff duty.
After this, in the year 2022, Tesla expressed his desire to come to India, but then there was no talk between the company and the government. Tesla had demanded the government to reduce the import duty on the entire montage vehicles from 100% to 40%.
The company wanted its vehicles to be considered as electric vehicles, not luxury, but the government had said that there was no intention of waiving or reducing import duty on any electric vehicle imported from other countries.
The government had said that if Tesla commits a manufacturing plant in India, it will be considered to be given a discount on import. However, Musk wanted cars to be sold first in India, after which the plant should be considered.
Earlier, Ellon Musk and Prime Minister Narendra Modi met in New York in June 2023.
India reduced import duty on foreign cars After this, Musk was scheduled to come to India in April 2024, but it was also postponed on the occasion. He moved to China in place of India. However, earlier this year, the Government of India has made changes in tax on imports of EV vehicles.
Import duty on cars worth more than $ 40,000 has been reduced from 125% to 70% and the tariff on the lithium-ion battery has been abolished.
This decision of the Government of India is being linked to Tesla’s entry into India. According to several reports, Modi can also meet Ilon Musk.