Trump Targets Indian Rice with New Tariff Threat

U.S President Donald Trump has hinted at possible fresh tariffs on rice imports from India, which sparked hot discussion among exporters and market traders. The President cited this in an event held at White House organized to aid U.S farmers.

The farmers argued that imports are hampering the market by weakening domestic rice prices. Trump held Indian exporters liable for “dumping” rice into the U.S market, thus citing the imposition of new tariffs on imports to protect the domestic producers.

Earlier this year, following up on a similar issue, the United States imposed a reciprocal tariff of 26% on Indian goods, including rice. However, the tariff was not permanent, & soon after, the U.S suspended enforcement of those tariffs until 9 July 2025 later extended to 1 August 2025.

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Eventually, on 1 August 2025, the initial tariff of 25% (which included the baseline 10% duty) on Indian goods became effective, as a trade deal was not finalized by the deadline. On 27 August 2025, an additional 25% tariff was imposed, bringing the total tariff on most Indian goods to 50%.

The impact of Trump’s comment triggered an immediate response in the Indian market. The share price of major exporters such as KRBL declines up to 2%, while LT Foods is down over 6%.

Even with the risk of tariffs, India remains the world’s largest rice exporter. In the 2024-25 fiscal year, the country exported about 20.1 Million Metric Tons of rice valued US$ 12.95 billion worldwide.

According to trade data, only about 5% of total exports are shipped to the U.S market. According to Industry experts, exporters may accelerate shipments to the U.S before tariffs are implemented, or they may divert the business to alternate markets in African countries, the Middle East, and Southeast Asia.

Trump’s latest announcement clearly demonstrates a continued commitment to protect domestic agriculture from global competition. This escalates the ongoing tension of the trade war between the nations & calls for the need to support producers in a sector critical to both the economy and rural livelihood.

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