From Howdy Modi to Tariffs on India – What Happened to the Bromance??

While a lot of Indians across the globe are scratching their heads asking, “Why us? I thought Trump and Modi were friends”, the answers lie in logic, negotiation tactics, and a bit of necessary political theatre. You get to decide the right or wrong while I simply write what I see with my big eyes under these clear Texas skies.

Let’s start with “what happened to the friendship or bromance?”. Well, in international trade, nothing is personal — and yet, everything is. When President Trump imposed tariffs on India during his administration, it wasn’t just another political headline. It was a calculated move with layered motivations from fair trade to “picking your friends wisely **wink**wink**”  — and it exposed some uncomfortable truths about how both nations approach trade.

At the same time, anyone who has ever received a package from a family member in the USA recently knows that India, too, isn’t shy about collecting duties — whether on bulk imports or sentimental gifts or a freakin on-the-counter stomach-relief medicine for your mother. 

Let’s unpack this from both sides.

🇺🇸 Five Logical Reasons Why Trump Imposed Tariffs on India

1. The Troubling Trade Deficit

The U.S. had a significant trade imbalance with India — in 2018 alone, the deficit stood at over $20 billion. We are talking India has won by billions every year in past in this game. Trump, a clever businessman, saw this as a dumb loss for America and sought to correct it using tariffs as a tool.

2. Limited Market for American Goods in India

India’s high import duties on products like medicines, automobile, and American agricultural goods were longstanding points of friction.  Trump highlighted these restrictions repeatedly, pushing for a level playing field. You can’t expect to hide these kind of things from Trump. You just can’t.

3. Regulatory Barriers and Price Controls for America in India are Out of Control

India’s price caps on medical devices and its complex regulatory environment created roadblocks for American companies. So one-sided that many American companies left India after trying to sustain business. Trump administration viewed these as tariff barriers without calling it a tariff that needed a strong policy response. You can’t expect chai from a neighbor while throwing rocks at his/her house.

4. Withdrawal from the GSP Program

In 2019, the U.S. ended India’s participation in the Generalized System of Preferences (GSP), which had allowed duty-free exports for thousands of Indian goods. This was a clear message: trade favors must be mutual.

5. Strategic Use of Tariffs as Negotiation Tools

Trump’s “America First” policy often used tariffs not just as economic weapons, but also as diplomatic instruments. With India, this meant signaling seriousness on broader issues — from defense cooperation to digital trade norms. You cannot not talk about India’s playing safe with maintaining friendship with the USA and Russia at the same time. This had to be exposed one day. If you think it wasn’t bothering Trump when he was holding Modi’s arm in the bromance walk in Houston during Howdy Modi, I can probably sell you an ice-bag in Alaska. I am not saying what is right or wrong, all I am saying is that the tariff on India is not a mystery.

🇮🇳 How India Acts When Collecting Money for India — From Imports to Personal Gifts

India’s customs and taxation system is thorough, deep, aggressive and in lack of the better term “greedy.” Or maybe it is not greedy, that is how a country should care for itself. Trump is trying to do- simply one-fourth of India has been doing forever.

Whether you’re importing electronics, bulk materials, or a care package of sweets and socks from your family in Texas, expect paperwork and money to pay.

Here are the primary ways India collects its share:

1. Basic Customs Duty (BCD)

This is the foundational tax on imports. It varies widely depending on the item and can go as high as 150%. For many goods, it’s the first layer of cost added upon arrival at Indian ports.

2. Integrated Goods & Services Tax (IGST) – The loud killer

After customs, India applies its GST framework on imports, typically ranging from 5% to 28%. This aligns imported goods with the domestic taxation system.

3. Social Welfare Surcharge -A silent killer

An additional 10% surcharge is levied on top of the basic customs duty. The revenue supports social development initiatives, though for the payer, it often feels like a silent surcharge.

4. Anti-Dumping and Safeguard Duties -Uggghhh

These are case-specific tariffs used to shield Indian industries from underpriced or excessive imports. Think of them as protective barriers for domestic manufacturers against aggressive international pricing.

5. Duties on Gift Packages from Abroad – Ouchhh

Most people are surprised to learn that even gifts sent by family and friends from abroad are taxable. If the value exceeds ₹5,000, the recipient could be charged up to 41.8% in total duties — regardless of whether the package contains chocolates or clothes.

🧾 Summary Table: How India Charges Import Duties

✍🏽 Final Thoughts

Trump’s tariffs on India weren’t out of thin air. They were strategic responses to a long-standing perception that India is both a valuable partner and a tough negotiator. And in every way, India’s own customs framework mirrors that — robust, protective, and unapologetically complex.

And, yes. You will see Trump talking bad about India or it’s economy. That is his not-so-secret style and it still works 90% of the time. People get intimated with humiliation. The only difference is that soft-spoken folks can commit a crime and look good and someone like Trump can take a bullet for his country and still looks bad because of how he talks. People aren’t as inclusive as they want the world to be. Mark my words- people are ONLY inclusive of what THEY like.

Back to the topic. Trade, after all, is not about sentiment. It’s about control, reciprocity, and economics — with a few layers of diplomacy folded in. When it comes to Trump, it comes with a lot of headlines too. Don’t get too wired up; just chill. Everyone is doing what they are supposed to in this game. 

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