PMO to Review US Tariffs: High-Level Meeting Called Amid Rising Trade Tensions

In a development that could significantly reshape India’s trade outlook, the Prime Minister’s Office (PMO) has called a high-level meeting this afternoon at 3:30 pm to assess the sweeping impact of fresh US tariffs on Indian goods. The United States has announced an additional 25% duty on imports from India, taking the overall tariff burden to a hefty 50%—a move that threatens to dent export competitiveness and strain already delicate trade ties between the two countries.

The urgency of the meeting reflects the seriousness of the situation. Senior officials from the Ministry of Commerce, Ministry of External Affairs (MEA), and the Central Board of Indirect Taxes and Customs (CBIC) will come together to brainstorm strategies, evaluate risks, and devise possible relief measures for exporters who are staring at steep new barriers in their largest trading partner’s market.

What Triggered the Tariffs?

The tariff escalation is not a routine trade measure but is tied to geopolitics. The US Department of Homeland Security officially notified New Delhi on Tuesday that the hike was being imposed as a penalty for India’s continued purchase of Russian crude oil. The new duty will be enforced from 12:01 AM EDT on August 27, 2025, meaning all Indian goods entering US ports thereafter—or withdrawn from bonded warehouses for consumption—will attract a 50% levy.

This decision comes against the backdrop of stalled ceasefire negotiations between Russia and Ukraine, which have left global energy and commodity markets in turmoil. Washington has been pressuring countries to reduce dependency on Russian oil. India, however, has consistently argued that as a growing economy with a heavy energy demand, it needs access to affordable crude supplies from wherever available, including Russia.

Government’s Balancing Act

Sources suggest that today’s review meeting will focus on three immediate questions:

1. How severe will the impact be on Indian exporters across sectors?

2. What short-term relief or support can the government extend?

3. How should India respond diplomatically without compromising its energy security?

Officials are expected to present data on trade flows, highlighting which sectors will be hit the hardest. Textiles, engineering goods, pharmaceuticals, and certain agricultural exports are believed to be particularly vulnerable, as they rely heavily on the US market.

At the same time, the government is unlikely to make any hasty compromises on its crude oil procurement strategy. “India will continue to procure oil from affordable sources worldwide, including Russia,” a government source indicated, underlining New Delhi’s firm position that economic stability cannot be compromised by geopolitical pressure.

A Blow to Exporters

For exporters, the sudden tariff jump from 25% to 50% is a daunting prospect. Margins are expected to shrink drastically, and competitiveness could erode in comparison to peers from other countries not subject to such punitive duties. Small and medium exporters—many of whom are still recovering from pandemic-related disruptions and global shipping volatility—fear that this could push them into a prolonged struggle.

Industry bodies are already voicing concern. Trade associations argue that exporters need urgent government intervention, ranging from financial relief packages to alternative market access strategies. Some have even suggested accelerating India’s ongoing free trade agreement (FTA) negotiations with other partners to hedge against such shocks.

Global Trade Dynamics at Play

The White House decision reflects the increasingly complicated overlap between geopolitics and global commerce. By targeting Indian goods, Washington has signaled that its patience with India’s energy policy is thinning. For New Delhi, however, the challenge is far deeper: how to maintain strategic autonomy while safeguarding trade and investment ties with its most significant economic partners.

India-US trade, which has grown steadily in recent years, may face turbulence if this standoff lingers. Last year, bilateral trade between the two nations crossed $190 billion, with the US being India’s largest export destination. That growth story now faces a sharp test.

The outcome of today’s PMO meeting will be closely watched not just by Indian businesses but also by international observers. The government is expected to announce possible mitigation measures—ranging from export subsidies and credit support to alternative trade routes—in the days to come. Diplomatically, back-channel negotiations may also be explored to prevent the tariffs from escalating into a full-blown trade war.

For now, Indian exporters are bracing for impact, waiting for clarity, and hoping for relief. What is certain, however, is that this development marks another reminder of how global politics can swiftly reshape economic fortunes.