EU unlikely to impose 100% tariffs on India on Trump's request; here's why

The European Union treats tariffs and sanctions differently and considers imposing such tariffs as a risky move, and supports targeting specific entities with sanctions

The European Union is unlikely to act on the advice of US President Donald Trump, who sought 100 per cent tariffs against India and China, the main buyers of Russian oil, to pressure President Vladimir Putin, Reuters reported.

 

On Tuesday (local time), Trump appealed directly to EU sanctions envoy David O’Sullivan and other officials. The European Union’s delegation was in Washington to discuss sanctions coordination against Russia, following its full-scale invasion of Ukraine in 2022.

 

Citing sources, the report stated that the European Union has not yet initiated a discussion regarding potential tariffs with India or China.

 

Here’s why the European Union is unlikely to impose 100 per cent tariffs on India:

 

European Union treats sanctions and tariffs differently 

The European Union treats tariffs and sanctions differently. It imposes sanctions only after an investigation, which usually lasts for months to establish a legally sound justification. So far, the European Union has only imposed tariffs on Russian and Belarusian fertilisers and farm products in the context of the Ukraine war.

 

 

Citing another European Union source, the report stated that the imposition of such tariffs is risky and could be considered too broad, adding that targeting specific entities with sanctions would be much easier, with the option of removing those sanctions if they stop doing business with Russians. Earlier in July, the bloc imposed extensive sanctions on Russia, along with sanctions on India's Nayara oil refinery and two Chinese banks.

 

Ongoing India-EU trade deal 

Furthermore, the bloc is in the middle of finalising a trade deal with New Delhi as the two sides are holding talks this week, seeking to resolve their differences over issues of agriculture, dairy, and non-tariff barriers to meet an ambitious end-of-year deadline for a deal.

 

India-European Union trade 

In the past two decades, total trade between India and the European Union saw a surge of 300 per cent.

In 2024, India ranked as the seventh trading partner of the European Union in the world, accounting for imports worth €71.281 billion, and was the European Union’s 10th goods export partner, which accounted for exports worth €48.771 billion.

 

On the other hand, the European Union bloc was India’s fourth trading partner in the world, in terms of imports, accounting for €45.286 billion in imports. In terms of exports, the bloc ranked second as India’s trading partner, accounting for €74.291 billion worth of exports.

 

EU’s trade deficit with India 

According to the Press Information Bureau statement, India’s bilateral trade in goods with the EU was $137.41 billion in 2023-24, making it the largest trading partner of India for goods. In addition, the bilateral trade in services, in 2023, between India and the EU was estimated at $51.45 billion. 

Goods exported from EU to India 

The European Union’s imports from India mainly comprise machinery and appliances, chemicals, base metals, mineral products, and textiles, whereas the bloc's main exports to India consist of machinery and appliances, transport equipment, and chemicals, as shown by data from the European Union website.

 

India-Middle East-Europe Economic Corridor 

The India-Middle East-Europe Economic Corridor was launched on the sidelines of the G20 Summit, held in September 2023 in New Delhi. The corridor is a significant project as it passes through Marseille in the Mediterranean Sea. A Memorandum of Understanding (MoU) was signed by the Indian government and the United States, the United Arab Emirates, Saudi Arabia, France, Germany, Italy, and the European Union.

 

The corridor aimed to integrate India, Europe, and the Middle East via the UAE, Saudi Arabia, Jordan, Israel, and the European Union. However, no progress has been made so far owing to the ongoing Gaza conflict.