Could Trump’s 50% Tariff Make Daily Living in India Costlier?

When US President Donald Trump slapped a 50% tariff on Indian goods, it was seen as another flare-up in the growing trade tensions between Washington and New Delhi. But beyond the big numbers, the question most Indians are asking is simple: will this make daily life in India more expensive?

Chief Economic Advisor (CEA) V. Anantha Nageswaran believes the tariff move may be short-lived. “I do feel that it will be more short-lived than long-lived,” he said, suggesting that Washington has already begun to realise the tariff may be counterproductive. But even if temporary, the ripple effects could still reach Indian households.
A tariff is essentially a tax on imports and exports. When the US imposes tariffs on Indian goods, it reduces India’s competitiveness in the global market. Exporters face shrinking margins, and some of that pain can spill back home in ways that affect everyday living.

• Jobs & Salaries: Sectors like textiles, steel, and IT services could feel the heat. Slower exports mean fewer orders, and in turn, pressure on employment and wages.
  
• Everyday Prices: While tariffs directly target exports, the shockwaves can affect domestic costs too. If exporters can’t sell abroad, surplus goods may flood the Indian market temporarily lowering prices. But in the longer term, reduced business and capital formation could push costs upward.
  
• Fuel & Transport: A separate 25% tariff on India’s purchase of Russian oil could make fuel costlier. That means higher taxi fares, airline tickets, and even food delivery bills.

Nageswaran pointed out that the real hit will come in the second half of the financial year. Why? Because India’s exports until August happened before the additional tariffs kicked in. This means the adverse effects—on GDP growth, employment, and consumer spending—are likely to be felt most between October and March.

If unresolved, the impact could spill into the next financial year, adding more uncertainty to household budgets.
On the domestic side, the government has moved quickly to cushion the blow. The GST Council recently simplified the tax system, reducing slabs to just 5% and 18%. This is expected to lower prices of daily essentials and boost consumption at home.

But will this be enough? The CEA admitted that while GST cuts will help, whether they can fully offset export losses and job impacts is “a different matter of calculations.”
India isn’t alone. Along with Brazil, it is facing the highest US tariff rate of 50%, largely because of Russian oil imports. Russia and China have already slammed the US for “illegal trade pressure.” But for Indian households, the debate isn’t about geopolitics — it’s about groceries, petrol, and the cost of living.

As Nageswaran put it, India’s search for alternative markets won’t be easy, meaning domestic consumption will have to bear more of the growth load. That could mean higher dependence on Indian consumers like you, and more pressure on household spending.
The honest answer: Yes, but not overnight.

• In the short run, GST cuts may shield consumers from the full impact.
  
• By the second and third quarters of this financial year, jobs, exports, and possibly fuel costs could pinch wallets.
  
• If the tariff dispute lingers into the next year, daily living - from shopping and commuting to eating out - could definitely feel costlier.
  

The big hope is that Trump’s tariffs really are as “short-lived” as economists predict. Because while trade wars may start in Washington, their echoes are always heard at the Indian dinner table.