The United States is pushing for the Group of Seven (G7) nations to consider imposing substantial tariffs on imports from India and China. This strategic initiative, reportedly ranging from 50% to 100%, aims to increase economic pressure on Russia amid ongoing geopolitical tensions.
The U.S. administration is scheduled to present this proposal during a virtual meeting of G7 finance ministers on September 12, 2025. This move follows previous actions, including a 25% tariff on Indian imports that was later raised to 50% due to India's continued purchases of Russian oil. The U.S. has also encouraged the European Union to explore similar measures against both India and China.
These developments have created significant strain in U.S.-India relations, with India expressing considerable concern over the potential economic repercussions. India's projections suggest that these tariffs could impact approximately $48.2 billion worth of its exports, potentially leading to job losses and a slowdown in economic growth. Experts estimate that these tariffs might reduce India's GDP growth by 0.5% to 0.6% in the current fiscal year.
Sectors such as textiles, gems, jewelry, and seafood are particularly vulnerable, facing a significant competitive disadvantage compared to countries like China, Vietnam, Cambodia, and others in Southeast and South Asia. The Federation of Indian Export Organisations has reported a halt in production for textile and apparel manufacturers due to deteriorating cost competitiveness.
The U.S. Treasury Department has stated that Chinese and Indian purchases of Russian oil are directly funding Russia's war efforts and prolonging the conflict. This perspective highlights the U.S. administration's belief that applying economic pressure on these major oil buyers could significantly weaken Moscow's economy. Canada, holding the G7 presidency, has confirmed that the meeting will consider "further measures to increase pressure on Russia and limit their war machinery," indicating a coordinated approach among G7 nations.
The effectiveness and scope of these proposed tariffs will be closely monitored as they unfold, potentially reshaping global trade dynamics and international relations.