Trump Tariff: How Strong Is India’s Trade with Iran and Will the 25% Duty Hit It?

New Delhi: US President Donald Trump has announced that America will impose an additional 25 percent tariff on any country that does business with Iran. This decision has been implemented immediately. Trump has called this a “final and decisive” step and said that its purpose is to increase economic pressure on Iran.

How and where did Trump make this announcement?

Trump gave this information on his social media platform, ‘Truth Social.’ He wrote in clear words that any country doing business with Iran will have to pay a 25 percent tax on all types of its trade with America.

Can India also be affected by this decision?

India is one of Iran's major trading partners, so it is natural to question whether India will also be affected or not. At present, America has not said anything by taking the name of any country, but if this rule is implemented on India then the problems of Indian exporters may increase.

How much trade happens between India and Iran?

According to government data, trade between the two countries stood at around $1.68 billion in the financial year 2024–25. India sent goods worth about $1.24 billion to Iran while importing goods worth $440 million from there. India has also benefited from this business.

How was the situation before US sanctions?

Till a few years ago, India-Iran trade was quite big. It reached $17 billion in 2018–19, but declined sharply after US sanctions.

What do India and Iran buy and sell from each other?

India sends basmati rice, bananas, tea, medicines, sugar and pulses to Iran. India imports petroleum products, chemicals, dry fruits, apples and glass items from Iran. Iran is considered a big market for Indian Basmati rice.

Why is Chabahar port important in this relationship?

Chabahar Port is very important strategically for India. India had signed a 10-year agreement for its operation in 2024, so that there would be direct access to Afghanistan and Central Asia.

How heavy can the new tariff be for India?

India is already facing a 25 percent US tariff for buying oil from Russia. If Iran tariff is also added, this burden may increase further. Due to this, Indian goods will become expensive in the American market and exports may be affected.

Has Trump adopted such a strategy before?

During the Russia-Ukraine war, Trump also imposed secondary tariffs on countries doing business with Russia. Now the same method is being adopted in the case of Iran also.

What could be the way forward for India?

Experts believe that India already does many deals through third countries, so the impact will not be a complete disaster. But costs will definitely increase, and doing business may become more difficult than before. Despite this, important projects like Chabahar are expected to continue for now.