Congress MP and Leader of Opposition in Lok Sabha Rahul Gandhi on Thursday reiterated U.S. President Donald Trump's assertion that India's economy is "dead" after Washington imposed new tariffs on Indian exports.
When questioned by journalists outside Parliament, Gandhi replied that Trump's statement is true to the status of India's economic situation today, stating that the Modi government has taken the country's financial well-being into chaos.
"Yes, he is right. I mean, everybody knows this except PM Modi and the Finance Minister. It is a dead economy. I am glad that the US President has stated facts. The entire world knows that BJP has ended the Indian economy to help Adani," Gandhi remarked, in a scathing criticism of the ruling BJP.
Trump had earlier lashed out at both India and Russia, referring to them as “dead economies,” and expressed disinterest in preserving trade relationships with either country. His remarks coincided with his announcement of a 25% tariff hike on Indian exports to the U.S., citing New Delhi’s strategic partnerships with Moscow, especially in energy and defence sectors.
Posting on Truth Social, Trump said: “I don’t care what India does with Russia. They can take their dead economies down together, for all I care.” He also accused India of implementing exorbitant trade restrictions, stating, “We have done very little business with India, their Tariffs are too high, among the highest in the World.”
The decision to impose the new tariff came just a day after India announced that a U.S. trade delegation would be arriving on August 25 for the sixth round of negotiations on a potential bilateral trade agreement.
While the White House has not so far published a complete breakdown of the penalties apart from the 25% tariff, U.S. officials said the actions were intended to curb India's growing economic and defense ties with Russia.
India's Russian crude imports have surged since the outbreak of the Ukraine war, increasing from a paltry 0.2% to as high as 35–40% of its overall oil imports. India has thus emerged as China's second-largest Russian crude buyer. Furthermore, New Delhi has remained steadfast in procuring sophisticated Russian military hardware, despite Western sanctions and admonishments.
In earlier remarks, Trump slammed India’s non-monetary trade practices, calling them “the most strenuous and obnoxious” globally—accusations he says have long kept American businesses at bay.
“India will therefore be paying a tariff of 25 per cent, plus a penalty for the above, starting on August first,” he declared.
Trade between the two countries reached $186 billion in the 2024–25 financial year, with India enjoying a $44.4 billion trade surplus. While Trump’s new tariff on Indian goods stands at 25%, it's notably lower than the 35% slapped on Bangladesh and 36% on Thailand, though still higher than those on Vietnam (20%) and Malaysia (25%).
India was already contending with a 10% baseline duty imposed under a previous executive order signed by Trump on April 2. The new tariffs, however, are expected to significantly heighten friction in the Indo-U.S. trade relationship.
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