Trump’s Iran Tariff Threat: Minimal Impact on India, Say Govt Sources

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fresh threat by US President Donald Trump to impose a 25 per cent tariff on countries doing business with Iran is expected to have only a minimal impact on India, government sources said Tuesday, reports PTI. Trump said the tariff would apply to any country trading with Tehran and would take effect immediately, as Iran faces widespread anti-government protests. Activist groups have put the death toll from the nationwide unrest at more than 2,000.“Effective immediately, any country doing business with the Islamic Republic of Iran will pay a tariff of 25 per cent on any and all business being done with the United States of America. This Order is final and conclusive,” Trump said in a post on social media.

Government officials, however, said there was no clarity on how or when the tariff would be implemented, as no formal notification has yet been issued by the Trump administration.India is already subject to steep US tariffs. In August, Trump imposed duties of up to 50 per cent on Indian goods, including an additional 25 per cent levy linked to India’s purchases of Russian crude oil. If India were to fall under the new Iran-related tariff regime, overall duties could rise further, sources said.

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Despite that possibility, officials said India’s exposure to Iran is limited. Iran does not figure among India’s top 50 trading partners, they noted. Bilateral trade between India and Iran stood at about $1.6 billion last year, accounting for roughly 0.15 per cent of India’s total trade.Trade with Iran is expected to decline further in the current financial year due to external economic factors, the sources said. India’s remaining trade with Iran is largely confined to food items and pharmaceuticals.India stopped importing crude oil from Iran in May 2019 after the US, during Trump’s first term, reimposed sanctions on Tehran.Iran’s total imports in 2024 were estimated at nearly $68 billion. Its main import partners were the United Arab Emirates, China, Turkey and the European Union, according to trade data cited by officials.India, however, continues to have strategic interests in Iran through the Chabahar Port project. New Delhi is a development partner in the port and has signed a 10-year agreement to operate a terminal there.The Trump administration granted a six-month exemption from US sanctions for the Chabahar port starting October 2024, recognising its role in regional connectivity.