Will India Bend To Trump Tactics?

Good Morning. As we have all understood by now, US president Donald Trump's tariff tantrums are hardly about trade. As Trump pressures India to stop buying oil and arms from Russia, the 50% total tariffs pose a real threat. But will India buckle under pressure? Its non-aligned history has some clues.

In other news, India’s car sales dip amid low consumer sentiment. Meanwhile, Apple wooing Trump with investments in America.

JANUS VIEW

Trump Unleashes Weapons Of Economic Destruction As India Refuses To Budge

The current week marks a very nasty anniversary of the first and only time nuclear weapons were used as weapons of war. The US bombed Hiroshima on 6 August 1945 and Nagasaki, three days later.

Both the uranium bomb and the plutonium bomb, developed as part of the Manhattan Project, were field-tested successfully, that is for sure. Whether these deadly attacks were necessary to force Japan to surrender is a matter of debate.

Nuclear weapons have since served to maintain mutual non-aggression by the world’s superpowers, each of which has enough weapons to destroy not only the enemy but the entire planet itself, several times over.

Mutually assured destruction underpinned this mutual non-aggression, which sounded a whole lot better when dressed up in French couture as detente. If one power were to strike with nuclear weapons first, it would be attacked in return.

But recently, Trump said he has repositioned two nuclear submarines in the face of what he described were nuclear threats made by former Russian president Dmitry Medvedev.

Some people believe this nuclear posturing was to take the public’s attention off Trump’s alleged proximity to financier and child sex trafficker Jeffrey Epstein, talk of which has grown louder since the Wall Street Journal carried a story about Trump’s gift of a bawdy drawing made to Epstein on his birthday.

US jobs data showed far fewer jobs being created since Trump’s Liberation Day in April.

Trump’s Weapons Of Economic Destruction

Trump has been unleashing his own weapons of economic destruction. He has announced cumulative tariffs of 50% on imports from India: 25% as ‘reciprocal’ tariffs and another 25% as penalty for buying weapons and oil from Russia. He has not yet dared to impose penal duties on the other major buyers of Russian oil, China and Turkiye.

Even at 25%, the tariff on Indian goods is higher than the ones Trump has imposed on Japan, South Korea, the European Union and nations that compete with India in labour-intensive exports. The saving grace is that the Trump tariff tantrum has kept trade in services outside its ambit, probably because the US has a surplus in global services trade.

It is welcome that India has, so far, refused to knuckle under. India has cherished its strategic autonomy and nurtured the capability to defend it through diplomacy, non-alignment, multi-alignment and building up of internal strength, of the economic and military kind, ever since Independence.

Right now, Pakistan is wooing the US, and being wooed back, with Trump suggesting that the US would help Pakistan discover and develop its oil reserves, so that Pakistan might even be in a position to sell oil to India.

Pakistan’s army chief is reportedly visiting Washington DC yet again. Pakistan evidently feels it is well-positioned to play the US and China off against each other to wrest concessions from both, much as India had obtained assistance from the US and the Soviet Union during the Cold War.

Time for India to strengthen ties with other countries?

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CORE NUMBER

19.6 lakh

That’s how many vehicles auto retailers sold in July 2025. That’s a 4.31% year-on-year drop from July 2024, when they sold 20.5 lakh units. According to the Federation of Automotive Dealers’ Association (FADA), that’s because of lower consumer demand due to unusual weather. 

📈 Sales, by the Numbers: 

Two-wheelers: : Fell by 6.48%

Passenger vehicles: Fell by 0.81%

Commercial vehicle sales: Rose by 0.23%

Tractor sales: Rose by 10.96%

Predictions: FADA says that it is cautiously optimistic about August 2025. Post-monsoon demand and the upcoming festive season will increase sales, though it flagged the recent US tariff and rupee depreciation as factors that could dampen consumer confidence. 

FROM THE PERIPHERY

Nayara Seeks Shipping Aid: Sanctions-hit Nayara Energy, backed by Russia’s Rosneft, is struggling to secure vessels for domestic fuel supply after the European Union imposed fresh curbs last month. The company has approached India’s shipping ministry for help, as foreign shippers are pulling contracts and citing insurance hurdles, Reuters reported.

The Turning Point: Microsoft also briefly suspended services to Nayara post-sanctions. The issue has intensified amid the backdrop of new US tariffs on Indian goods, which have heightened geopolitical and trade uncertainty.

Outcome: India is now considering deploying India-flagged vessels for Nayara, with the ministries of shipping, oil, and foreign affairs expected to meet soon to address the crisis.

Apple Woos Trump: Apple will invest $600 billion in the US, which will create 450,000 supplier and partner jobs, and 12,000 direct Apple jobs, according to a press release by the company. Apple’s main plan is to expand US rare-earth processing and magnet manufacturing and increase glass production. The press release states that soon, every iPhone and Apple Watch will be built with Kentucky-made cover glass. 

How We Got Here: Apple predominantly manufactures in China, though it has been in the process of shifting operations to India. In fact, in Q2 2025, India became the largest supplier of iPhones to the US. But, India is still largely a final-stop assembly point for Apple. 

What This Means Going Forward: Apple’s announcement aligns with US President Trump’s aggressive push toward domestic manufacturing; CEO Tim Cook even gifted Trump a custom-made silicon wafer embedded in gold with a ‘Made in the USA’ engraving. Trump is using the threat of tariffs – starting today, India faces a 50% tariff on its goods – and by producing and supplying from the US, Apple can avoid facing steep tariff costs. 

TCS to Hike Salaries of 80% of Employees. Starting September 1, 80% of employees working at Tata Consultancy Services(TCS) will receive a salary hike, according to a Business Standard report. Junior to mid-senior level employees in three brackets (C1, C2 and C3A) will receive these hikes, a company-wide email said.

Origin: This news comes soon after TCS announced layoffs of 2% of its workforce; that’s 12,000 people, most of whom are mid to senior-level managers. The company said it will be deploying AI on a large scale and did this to become “future-ready.” 

Breakthrough: Already, India’s IT sector has not been doing too well; experts say that’s because of macroeconomic instability and geopolitical tensions. TCS’s layoffs have ignited broader conversations about the direction India’s IT sector is headed in. 

Mobile Exports Drive Growth: India’s electronics exports surged 47% year-on-year in Q1 FY26, reaching $12.4 billion, driven largely by mobile phones, which jumped 55% to $7.6 billion, according to India Cellular & Electronics Association (ICEA) data. Non-mobile exports like solar modules, chargers, and networking gear rose 36% to $4.8 billion.

Flashpoint: ICEA chairman Pankaj Mohindroo hailed the performance but stressed the need to scale other segments like IT hardware and wearables.

Fast Facts: India’s electronics output quadrupled from $31 billion in FY15 to $133 billion in FY25, aided by the Production Linked Incentive (PLI) and Phased Manufacturing Programme (PMP) schemes. ICEA projects FY26 exports to hit $46–50 billion, while urging deeper value addition and supply chain resilience for long-term competitiveness.

THE SIGNAL DAILY

Inside the US Student Visa Crisis of 2025

Indian students form 27% of the international student body in the US. The US has some of the world’s best universities, with top resources and faculty. Even though studying there is expensive, many Indian students still aspired to go abroad. They’d apply for education loans and aim to get a high-paying job to pay those back.

But, that could change now. The Trump administration has been deporting students in the US. They also stopped accepting appointments for several weeks, and are now scrutinising the social media accounts of students much more closely. Educational consultants call this year a crisis year for students wanting to study in the US. 

In the latest episode of The Signal Daily, we’ll hear from a student and from an educational consultant. What’s the future of an American education for Indians? 

The Core produces The Signal Daily. To check out the rest of our work, go to www.thecore.in.

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PODCAST

On Episode 649 of The Core Report, financial journalist Govindraj Ethiraj talks to Garima Kapoor, Economist & Executive Vice President at Elara Securities (India) as well as C S Vigneshwar. President at FADA.

• Indian markets bet on a solution to India-US tariff war

• Which sectors are really affected at peak tariff and why ?

• Are Indian state owned refiners pulling back on Russian oil ?

• Signs of weakness in India’s auto market as sales fall but a base effect may be affecting numbers and is there a small car revival ?

• And Aamir Khan the actor makes a debut on The Core

👥 THE TEAM

✍️ Zinal Dedhia, Kudrat Wadhwa | ✂️ Rohini Chatterji | 🎧 Joshua Thomas