India, reeling from a record trade deficit with China, used the latest BRICS summit to argue for stronger intra-bloc economic mechanisms and a fair global trading order — even as punitive U.S. tariffs imposed under the Trump administration threaten to shift New Delhi’s strategic trajectory and undermine long-standing diplomatic ties.

BRICS as Economic Counterbalance

At the summit chaired by Brazilian President Lula, Indian External Affairs Minister S. Jaishankar urged members to take collective steps to mitigate trade imbalances. He emphasized that the international trading system must be "open, fair, transparent and inclusive," warning that protectionist impulses,** such as retaliatory tariffs, are counterproductive. Brazil’s President echoed the sentiment, denouncing a rise in "tariff blackmail" and calling for greater financial and trade integration among BRICS nations to withstand external pressure.

U.S. Tariffs and India’s Economic Fallout

The U.S. escalated tensions in 2025 by doubling its tariffs on Indian goods—from 25% to 50%—as punishment for India's continued purchase of Russian oil. India estimates that up to 55% of its exports to the U.S. could be impacted, with GDP growth forecasted to decline by 0.5–0.6% this fiscal year. Economic experts slammed the tariffs as coercive. Former RBI Governor Raghuram Rajan notably remarked it’s “hard to negotiate with a gun to your head,” highlighting the unfair leverage the U.S. is wielding.

Strategic Realignments in Asia

India’s pivot to BRICS and warmer engagements with China are widely seen as a reaction to bilateral strain with the U.S. Recent diplomatic developments, including a meeting between Prime Minister Modi and President Xi, point to a thaw in previously tense relations. Expanded ties within BRICS—cost-effective trade, shared strategic perspectives—offer India a counterbalance to Western pressures, while reinforcing its multipolar alignment.

Regional Effects and Global Stakes

India’s deepening ties with China and other BRICS nations have significant geopolitical implications. Political analysts argue that Trump-era tariffs are inadvertently pushing India toward strategic autonomy and closer ties with Russia and China—potentially reshaping global power dynamics. Meanwhile, U.S. lawmakers across party lines expressed concern that the tariffs not only strain relations with India—a key Indo-Pacific partner—but may damage U.S. competitiveness and industry.