Trump firm on tariffs as India banks on reforms to counter April 2 fallout
The White House has confirmed that President Trump will impose new tariffs on Wednesday, but hasn’t specified details of the size and scope of trade barriers that are set to impact India among other nations. White House spokeswoman Karoline Leavitt on Tuesday said reciprocal tariffs on countries that imposed duties on US goods would take effect immediately after Trump announced them on Wednesday, while a 25 per cent tariff on auto imports would take effect on April 3.
Sensex tanks 1,390 pts ahead of US ‘Liberation Day’
Sensex plunged by 1,390 points amid heightened uncertainty ahead of the anticipated rollout of US reciprocal tariffs on April 2, termed as ‘Liberation Day’ by President Trump. The Nifty dropped 353.65 points or 1.50 per cent to 23,165.70.
Ahead of President Trump’s April 2 deadline for reciprocal tariffs, the US reiterated that India was imposing 100 percent levy on American agricultural goods. To deal with a possible fallout of the US move, the Commerce Ministry said it had initiated comprehensive tariff reforms to correct the inverted duty structures.
At a media briefing in Washington DC, Leavitt said: “It’s time for reciprocity.” Trump “is going to make historic changes”, said Leavitt, naming India, Canada, Japan and the European Union for imposing high tariffs on US goods. “Unfortunately, these countries have been ripping off our country for far too long,” she added.
Leavitt confirmed that there won’t be any exemptions on reciprocal tariffs. “The goal of Wednesday (April 2) is a country-based tariff, but certainly sectoral tariffs. The President has said he’s committed to implementing them,” she said.
In New Delhi, Minister for State in Commerce Ministry Jitin Prasada today informed Parliament that the government was gearing up to tackle the threat by starting with reforms. “Such reforms are designed to reduce production costs, encourage domestic manufacturing, and enhance global competitiveness. However, despite reductions, some domestic industries advocate for higher tariffs to protect against foreign competition,” he said. Trump’s labelling of April 2 as “Liberation Day” has fuelled anxiety globally. Trump on Tuesday said: “I heard a while ago that India will also be dropping its tariffs substantially.”
In India, the Sensex and Nifty — the two benchmark indices — extended the fall for the second consecutive session on the first day of new financial year 2025-26 (April 1). At close today, Sensex was down 1,390.41 points (1.80 percent) at 76,024.51, and Nifty fell by 353.65 points (1.50 percent) at 23,165.70. In the backdrop of this high-stakes tariff war, a back and forth is happening in the energy sector — crude oil and nuclear.
Trump on Sunday threatened “secondary tariffs” on buyers of Russian oil if President Vladimir Putin refused a ceasefire with Ukraine. If secondary tariffs are imposed, Indian refiners — highly reliant on Russian crude — will need to get more non-Russian supplies. The other significant development is on nuclear energy. Last week, in a major breakthrough for India-US nuclear cooperation, the US Department of Energy (DoE) granted Holtec International, a supplier of equipment and systems for the energy industry, regulatory approval, allowing it to transfer small modular reactor (SMR) technology to three Indian entities — Holtec Asia (its regional subsidiary), Tata Consulting Engineers Ltd, and Larsen & Toubro Ltd.
This is first such move since the 2007 India-US civil nuclear agreement or the 123 Agreement.
The US decision comes at the cusp of India’s new financial year that commenced today. Finance Minister Nirmala Sitharaman, in her Budget proposals for this fiscal had spelt out push towards nuclear energy.
The Department of Atomic Energy, headed by Prime Minister Narendra Modi, had issued a statement on February 3 — two days after Sitharaman’s Budget speech — saying the government would facilitate the implementation of the Nuclear Energy Mission.
“Amendments to the Atomic Energy Act and Civil Liability for Nuclear Damage Act will be taken up by Parliament. These amendments are expected to encourage private sector investments in nuclear power projects,” it had added.
A major sticking point has been India’s Civil Liability for Nuclear Damage Act (2010), which holds suppliers liable for damages in case of a nuclear accident. This provision has deterred foreign nuclear vendors from investing in India’s nuclear sector.
In the US, there is ample support for Trump on tariffs. Leavitt said: “He’s (Trump) doing this in the best interest of the American worker.” Similarly, US Trade Representative Jamieson Greer in a statement said: “No American President in the modern history has recognised the wide-ranging and harmful foreign trade barriers American exporters face more than President Trump.”
Nation