India has announced plans to impose retaliatory tariffs on certain US goods, escalating trade tensions as Washington prepares to implement higher duties on imported automobiles and components. The proposed Indian duties would match the financial impact of the US measures, affecting about $2.9 billion worth of annual imports with $723.75 million in additional costs for American exporters.

The notification was submitted to the World Trade Organization, marking a formal step by New Delhi to push back against what it calls unfair “safeguard” measures. India argues that the US tariffs, imposed under the pretext of protecting domestic industry, disproportionately harm Indian exporters.

Trade talks at critical stage

The announcement comes as both sides try to finalize an interim trade agreement before a July 9 deadline, when the US tariffs are set to take effect. President Donald Trump has said the US will begin notifying trade partners about the new duties, which are expected to be enforced starting August 1.

India has adopted a firmer tone in recent weeks, signaling that it will not sign any deal that fails to address both market access and tariff reciprocity. The Indian government has also dismissed Trump’s claims that trade discussions played a role in brokering a ceasefire with Pakistan.

Last month, India initiated consultations with the US at the WTO, formally challenging the 25% tariffs imposed on passenger vehicles, light trucks, and select auto parts. New Delhi’s move reflects growing unease with the direction of US trade policy and a desire to assert its interests ahead of any broader agreement.