Market Scope Digest

U.S.–India Tariff Clash Takes New Turn as Trump Claims “Zero Tariff” Offer

September 1, 2025 — The U.S.–India trade standoff entered a dramatic new phase today as President Donald Trump declared that India has offered to slash tariffs on U.S. goods to zero. The announcement, made during remarks at the White House, marked a potential breakthrough—but one still unconfirmed by New Delhi.

“India has finally come around and said they’ll reduce their tariffs to zero,” Trump said, while emphasizing that the move came “too late” after years of what he called “one-sided” trade. As of Monday evening, India’s government had not issued any formal statement confirming such a shift.

August Tariffs Still in Place

The President’s comments come less than a month after the U.S. imposed an additional 25 percent tariff on select Indian goods, pushing some duty levels close to 50 percent. Washington cited India’s continued purchases of Russian oil as a key reason for the escalation.

Importers were notified that the higher tariffs would apply to shipments arriving after late August, with phased effective dates into mid-September. Customs guidance from U.S. authorities has made clear the surcharges remain in force until formally lifted.

Signals from New Delhi

India has made limited moves that suggested a willingness to ease tensions. In August, New Delhi temporarily suspended its 11 percent cotton import duty through September 30, a step widely interpreted as both a relief measure for its domestic textile industry and a goodwill gesture toward Washington.

But critical sticking points remain, particularly in agriculture, where U.S. access to India’s dairy market has long been restricted. Energy ties are also at the heart of the dispute, as Washington pressures India to scale back purchases of discounted Russian crude.

What Changed on Sept. 1

Trump’s claim of a “zero tariff” pledge represents a sharp departure in tone from weeks of tariff escalation. Yet without a formal decree from India’s finance ministry or a U.S. suspension order, companies on both sides are left navigating uncertainty.

For U.S. importers of Indian goods, the additional 25 percent duty remains payable until further notice.
For U.S. exporters, India’s tariff schedule is unchanged, despite the President’s statement.

What Comes Next

Analysts see three possible scenarios in the coming weeks:

A deal: India issues official notifications cutting tariffs on U.S. goods, with Washington suspending its surcharges.
A stalemate: Statements continue without legal follow-through, leaving tariffs in place.
An escalation: Further measures emerge if talks stall, particularly if linked to energy policy or broader geopolitical rifts.

For now, the rhetoric has shifted—but until both governments publish binding orders, the tariff burden remains real for businesses on both sides of the trade corridor.

— Market Scope Digest