Just two days before the temporary tariff pause ends on July 9, US President Donald Trump announced that the United States will impose 25% tariffs on imports from Japan and South Korea starting August 1. These tariffs are part of Trump’s new trade policy, which he shared in letters to the leaders of both countries on Monday. He posted the letters on his social media platform, Truth Social.

Trump said, “If for any reason you decide to raise your tariffs, then whatever the number you choose to raise them by will be added onto the 25% that we charge.”

The 25% tariff rate for South Korea remains the same as the one Trump had announced earlier on April 2. However, the tariff on Japan has been increased by 1% from the earlier announcement. Earlier, Trump had capped tariffs at 10% till July 9 to allow time for trade negotiations. So far, only two trade agreements have been finalised—one with Britain and another with Vietnam.

India in last phase of talks and may get time till August 1

India is also in talks with the US for a mini trade deal. However, the agreement is still not ready. The US has said it may allow negotiations with India to continue until an extended deadline of August 1.

Indian officials said that the negotiations had almost reached the final stage, but some last-minute issues delayed the announcement of a deal. Now, there may be more time available to finish the talks.

A government official told The Indian Express that agriculture remains a major sticking point in the discussions, as India has taken a strong stand on this issue. The likely deal will cover only trade-in goods. Services and labour issues are not part of the current talks.

The Indian negotiating team, led by Chief Negotiator and Special Secretary Rajesh Aggarwal, returned last Friday after a week-long round of talks in the US.

US Treasury Secretary Scott Bessent told CNN on Monday, “We’re going to be very busy over the next 72 hours. President (Donald) Trump is going to be sending letters to some of our trading partners saying that if you don’t move things along, then on August 1, you will boomerang back to your April 2 tariff level.”

He added, “So, I think we’re going to see a lot of deals very quickly. And we’re going to send out probably 100 letters to small countries where we don’t have very much trade, and most of those are already at the baseline, 10 percent.”

This strategy, the US believes, has already helped push countries like the European Union (EU) to make progress. Bessent said that three weeks ago, President Trump threatened 50% tariffs on the EU, and that same day, top European leaders started calling the White House.

“The playbook is to apply maximum pressure,” Bessent said. “You know, we saw that the EU was very slow in coming to the table. Three weeks ago, on a Friday morning, President Trump threatened 50 percent tariffs. And within a few hours, five of the European national leaders had called him. Ursula von der Leyen, the head of the EU, was on the phone, and the EU is making very good progress. They were off to a slow start.”

The August 1 deadline, according to Bessent, is not a new cut-off but the final date to speed up progress. If countries don’t reach a deal by then, they will go back to the higher April 2 tariff levels.

However, Bessent assured that the US will not impose extremely high tariffs—up to 70%—on major trading partners. “We are close to several deals… There’s a lot of foot-dragging on the other side, and, you know, so I would expect to see several big announcements over the next couple of days,” he said. He also refused to name countries that may be close to an agreement: “I’m not going to name names because I don’t want to let them off the hook.”

US-India ties remain strong amid trade pressure

Despite the delays, the US has said that India continues to be a strategic partner. White House Press Secretary Karoline Leavitt said, “The President said last week (that the US and India are very close to a trade deal), and it remains true. I just spoke to our Secretary of Commerce about it. He was in the Oval Office with the President. They are finalising these agreements, and you’ll hear from the president and his trade team very soon when it comes to India.”

She added that President Trump has a strong relationship with Prime Minister Narendra Modi and that the countries remain close allies in the Asia-Pacific region.

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