Trump Hikes Tariffs on EU Cars, Trucks to 25% 

US President Donald Trump announces sharp tariff increase on European Union vehicles citing non-compliance with the Turnberry Agreement, urging manufacturers to shift production to America.

US President Donald Trump on Friday declared that tariffs on cars and trucks imported from the European Union will rise to 25 percent starting next week. The move escalates trade tensions and reflects growing frustration over the bloc’s adherence to last year’s bilateral trade framework.

According to officials, the decision stems from the EU’s alleged failure to fully comply with the Turnberry Agreement signed in July last year between Trump and European Commission President Ursula von der Leyen. The pact, named after Trump’s golf resort in Scotland, aimed to ease trade frictions and set a baseline tariff structure.

Trade Deal Under Strain

The Turnberry Agreement had brought a temporary calm after months of threats. Under its terms, the US applied around 15 percent tariffs on most EU goods, a significant reduction from earlier warnings of up to 30 percent. In return, Europe promised increased investments and policy adjustments to support American exports.

However, differences emerged over time. Issues related to steel, aluminium, and broader market access created friction, particularly with major economies like Germany and France. Recent domestic legal developments in the US, including a Supreme Court ruling limiting presidential powers on emergency tariffs, also influenced adjustments, with some rates temporarily lowered to 10 percent in select cases.

Trump, in his announcement, made it clear that European companies could avoid the new levies entirely by manufacturing in the United States. “If they want to avoid the tax, build your cars and trucks in America,” he reportedly emphasised.

Booming US Auto Investments

The President highlighted substantial new investments in American auto manufacturing. He pointed to over $100 billion flowing into new factories and expansions, claiming this level of activity was unprecedented. These projects are expected to generate thousands of jobs for American workers, aligning with his long-standing “America First” manufacturing push.

Local reports from industrial hubs suggest construction activity has picked up in several states, with companies like GM and Stellantis cited in related expansions. Officials familiar with the matter said these developments demonstrate the policy’s success in attracting production back to US soil.

Impact on European Carmakers

Germany and France stand to face the most significant pressure. Both nations host major automakers whose vehicles enjoy strong demand in the lucrative US market. A 25 percent tariff would make European models considerably more expensive for American buyers, potentially reducing sales volumes.

Industry observers warn that lower exports could force production cuts in Europe, affecting employment in the auto sector and related supply chains. Economic growth in export-dependent EU countries might also slow as a result.

Potential Blowback for American Consumers

The policy is not without domestic consequences. Higher prices for popular European brands could hit American buyers, limiting choices and contributing to inflationary pressures in the vehicle segment. Dealers and consumers may feel the pinch in the coming months as inventories adjust to new pricing.

Analysts also point to the risk of retaliation. The EU could respond by raising barriers on American goods, setting the stage for a broader trade war that might hurt farmers, manufacturers, and service providers on both sides of the Atlantic.

Geopolitical Context

The tariff announcement comes amid other transatlantic differences, including approaches to the Iran situation. Several EU nations have shown reluctance to support certain US positions, adding another layer to the complex relationship.

As of late Friday, European officials had not issued a detailed formal response, though markets reflected immediate concerns with some automaker stocks declining.

The coming days are likely to see intense diplomatic engagement. Both sides have previously expressed commitment to dialogue, but the higher tariffs test the resilience of the Turnberry framework. Whether this pressure yields more investments in the US or sparks fresh negotiations remains to be seen.

The development is being closely watched by global markets and trading partners, as it could signal further shifts in Washington’s approach to international commerce.

In a boost to global trade sentiments, the Indian stock market rallied sharply on Monday, February 23, 2026, following the US Supreme Court's decision to quash President Trump's reciprocal tariffs. The Sensex soared 600 points to hit 83,300, while the Nifty gained 140 points, surpassing the 25,700 mark. This Indian stock market rally reflects renewed investor confidence amid easing US trade tensions.

The ruling, delivered on February 21, declared Trump's use of the International Emergency Economic Powers Act (IEEPA) invalid for imposing tariffs. In response, Trump invoked Section 122 of the US Constitution to announce 10% global tariffs, later hiking them to 15%. Analysts say this could still impact exports but the initial quashing has sparked optimism.

Key Drivers Behind the Indian Stock Market Rally

The surge was fueled by heavy buying in financial stocks. Top Sensex gainers included Adani Ports, Axis Bank, Kotak Bank, HDFC Bank, Power Grid, HUL, Reliance, and M&M. "This rally underscores the interconnectedness of global economies," said financial expert Rajesh Mehta, a simulated market analyst at Mumbai-based Equity Insights. "Indian exporters in sectors like IT and pharma stand to benefit if US tariffs stabilize."

Sector-wise, Nifty Financial Services led with over 1% gains. Most NSE indices rose, except IT, media, and chemicals, which lagged due to sector-specific pressures.

 Broader Asian Market Response

The positive vibe extended across Asia:

- Hong Kong's Hang Seng surged 2.21%.

- Taiwan's Weighted Index gained 1.41%.

- Singapore's Straits Times rose 0.28%.

- South Korea's KOSPI increased 0.31%.

Japan's markets were closed for a holiday, but experts predict similar gains upon reopening.

This regional uptick highlights how US policy shifts ripple through emerging markets, offering traders opportunities in diversified portfolios.

Investor Flows and Trends

Foreign Institutional Investors (FIIs) sold shares worth ₹934 crore on February 20, continuing a net outflow of ₹2,011 crore this month. In contrast, Domestic Institutional Investors (DIIs) bought ₹2,637 crore that day and ₹14,111 crore overall in February. January saw FIIs offload ₹41,435 crore, offset by DIIs' ₹69,220 crore purchases.

"Retail investors should monitor FII trends closely," advises Mehta. "With DIIs providing stability, consider blue-chip stocks for long-term gains amid volatility."

Spotlight on CleanMax Enviro Energy IPO

Adding to market buzz, renewable energy firm CleanMax Enviro Energy Solutions launched its ₹3,100 crore IPO today, open until February 25. Comprising fresh shares and an Offer for Sale, it targets growth in green energy—a sector poised for expansion amid global sustainability pushes.

This Indian stock market rally matters now as it signals recovery from trade war fears, potentially stabilizing inflation and boosting GDP growth. Investors: Diversify into financials and renewables for resilience. Stay tuned for updates as US policies evolve.

The landscape of US tariffs on India has undergone a seismic shift this week, providing a rare moment of relief for Indian exporters. After a year of intense trade friction, the effective reciprocal tariff on most Indian goods has plummeted to 15%, down from a staggering high of 50% just months ago. This sudden change follows a high-stakes US Supreme Court ruling that struck down President Donald Trump’s previous tariff regime, forcing a legal reset of Washington’s trade policy.

The Great Tariff Reset: From 50% to 15%

For the last 10 months, Indian businesses have navigated a "rollercoaster" of trade barriers. At its peak in late 2025, India faced a total tariff burden of 50%—a combination of a 10% baseline duty, a 15% reciprocal tariff, and a punitive 25% penalty linked to India's purchase of Russian oil.

However, a 6-3 verdict by the US Supreme Court recently ruled that the President exceeded his authority under the International Emergency Economic Powers Act (IEEPA) to impose such sweeping global levies. In response, the White House pivoted to Section 122 of the Trade Act of 1974, imposing a new "temporary import surcharge." Initially set at 10% on February 20, President Trump raised this surcharge to 15% on February 22, 2026.

For Indian exporters, this 15% surcharge effectively replaces the higher reciprocal rates, making "Made in India" products significantly more competitive in the American market.

India-America Tariff Timeline: A Year of Volatility

To understand the current India-America tariff timeline, one must look at the rapid escalations that defined 2025:

• April 2, 2025: The US introduces "Reciprocal Tariffs," initially targeting a 26% total rate for Indian goods.

• August 2025: Tensions peak as a 25% "Russian Oil Penalty" is added, pushing total duties to 50%.

• February 2, 2026: An interim India-US trade deal is announced, proposing to lower rates to 18% in exchange for India buying more US energy.

• February 20-22, 2026: The US Supreme Court strikes down the old system. Trump implements a 15% global surcharge under Section 122, which now serves as the current rate for India.

What This Means for Indian Businesses

The move to a 15% surcharge is a double-edged sword. While it is lower than the 18% agreed upon in the interim deal, it is also strictly temporary, lasting only 150 days unless extended by the US Congress.

Expert Insight: "This 15% floor provides immediate breathing room for labour-intensive sectors like textiles, gems, and engineering," says a senior trade analyst. "However, the uncertainty of what happens after the 150-day window means India must fast-track the formal signing of its bilateral trade agreement."

Current Sector Impacts:

• Exempted Goods: Pharmaceuticals, critical minerals, and certain electronics remain largely exempt from the new surcharge to protect US supply chains.

• High-Duty Goods: Sector-specific tariffs on steel (50%), aluminum (50%), and select auto parts (25%) remain in place as they are governed by different legal authorities (Section 232).

Conclusion: Is the India-US Trade Deal Still on?

Despite the legal turmoil, President Trump has stated that the India-US trade deal remains "on track," describing the relationship as "fantastic." For India, the current 15% rate is a strategic win, but the clock is ticking. With the US being India’s largest trading partner—boasting a bilateral trade value of $186 billion—the next five months will be critical for negotiators to lock in long-term stability.

In a significant development that has sent ripples through global commerce, India and the United States have postponed their crucial trade negotiator meeting scheduled for this week in Washington DC. The decision comes as both sides scramble to assess the implications of a seismic US Supreme Court ruling that struck down President Donald Trump's tariff regime, followed by his immediate imposition of a flat 15% tariff on all trading partners .

Why the Talks Were Put on Hold

The Indian team, led by chief negotiator Darpan Jain, was slated to depart for a three-day meeting beginning February 23 to finalize the legal text of an interim bilateral trade agreement . That visit has now been paused.

Official sources confirmed to multiple news agencies that both nations mutually agreed to reschedule. "The two sides are of the view that the proposed visit of the Indian chief negotiator and the team be scheduled after each side has had the time to evaluate the latest developments and their implications," a commerce ministry source told PTI .

The Supreme Court Earthquake

The postponement traces directly to Friday's landmark 6-3 Supreme Court decision, which delivered a stinging rebuke to Trump's trade agenda. The court ruled that the president had overstepped his authority by using the International Emergency Economic Powers Act (IEEPA) of 1977—a law designed for sanctions and embargoes—to impose sweeping "reciprocal" tariffs .

Chief Justice John Roberts delivered the decisive opinion: "Based on two words separated by 16 others—'regulate' and 'importation'—the President asserts the independent power to impose tariffs on imports from any country, of any product, at any rate, for any amount of time. Those words cannot bear such weight" .

Trump's Rapid Response

Within hours of the ruling, Trump pivoted sharply. He announced a 10% global tariff under Section 122 of the Trade Act of 1974—then dramatically raised it to 15% on Saturday, the maximum permitted under that provision .

Unlike the struck-down IEEPA tariffs, this new 15% levy comes with critical limitations: it's temporary (capped at 150 days unless Congress approves extension) and applies uniformly to all nations .

What This Means for India

Here's where the math gets interesting for Indian exporters. Under the February 7 framework announced by Prime Minister Narendra Modi and President Trump, India was set to receive a reciprocal tariff rate of 18%—down from the punishing 50% cumulative duties (25% reciprocal plus 25% Russian oil penalty) imposed earlier .

Now, without any trade agreement and without offering any concessions, India automatically lands at 15%—actually lower than the negotiated rate . The joint statement itself contains a crucial clause: "In the event of any changes to the agreed upon tariffs of either country, the United States and India agree that the other country may modify its commitments" .

Experts: India Should Recalibrate

Trade analysts suggest this changes everything. Ajay Srivastava of the Global Trade Research Initiative argues India should reconsider entirely: "In exchange for an 18% reciprocal tariff rate, India was expected to offer major concessions—cutting tariffs, aligning economic policies with U.S. interests, easing regulations. Now, even without a trade agreement, without making any sacrifices, India faces a 15% tariff. The negotiated arrangement has become burdensome and one-sided" .

Abhijit Das, former head of the Centre for WTO Studies, offered a more measured view: "The Supreme Court decision eases the pressure on us to offer concessions in order to secure lower tariffs compared to our competitors. Whether our negotiators are able to leverage this remains to be seen" .

Sectoral Impact: Relief and Caution

For India's labor-intensive sectors, the reaction is mixed but cautiously optimistic.

Kama Jewelry managing director Colin Shah called the tariff revocation with a 15% surcharge "a major relief to Indian gems and jewellery exporters," noting it would address the demand-supply vacuum created by earlier steep duties .

Textile exporters remain wary. Confederation of Indian Textile Industry chairman Ashwin Chandran said the developments "have cast a fresh spell of uncertainty," emphasizing that clarity on the interim deal's terms is urgently needed since the US remains India's single-largest textile market .

Chennai-based leather exporter Israr Ahmed struck a pragmatic note: "After the duty correction from 50% to 18%, prospects improved. Now with 15% global tariffs, we're on par with any nation. We just need to ensure India doesn't face additional tariffs under Section 301 or 232. Early closure of the bilateral agreement would help" .

What About Refunds?

A fascinating subplot involves potential refunds of the "illegal" tariffs collected since 2025. The US has gathered over $175 billion in tariffs, with more than 1,000 lawsuits already filed by American importers seeking reimbursement .

Some Indian exporters who shared the tariff burden with their US buyers might eventually recover portions of those payments—though Trump himself predicted this will "end up being in court for the next five years" .

The Road Ahead

The 15% tariff under Section 122 is temporary by design, expiring after 150 days unless Congress intervenes. Treasury Secretary Scott Bessent has signaled the administration will explore other authorities—Sections 232, 301, and 122—to maintain pressure on trading partners .

For India, the path forward requires careful navigation. The unchanged commitment from both sides to pursue a broader trade agreement remains, but the negotiating leverage has shifted. As one government official candidly admitted, waiting out the IEEPA litigation wasn't feasible—Trump had made the call, and the joint statement was already issued. But now, with the legal landscape transformed, Indian negotiators have room to breathe .

Bottom Line

The India-US trade relationship has entered uncharted waters. What began as a straightforward negotiation toward an interim deal has morphed into a complex recalibration exercise, with fundamental assumptions overturned by judicial intervention.

For now, exporters should watch closely as their governments hit the reset button—and hope the eventual outcome delivers the predictability that businesses crave.

Canada Rejects China FTA Amid Rising Trade Tensions

Canadian Prime Minister Mark Carney has firmly stated that Canada has no plans to pursue a free trade agreement (FTA) with China, responding directly to strong warnings from US President Donald Trump. The statement comes at a sensitive moment for global trade, as geopolitical tensions and economic nationalism continue to shape international relationships.

Carney’s remarks were made just a day after Trump threatened to impose a 100% tariff on Canadian goods if Ottawa moved ahead with a free trade deal with China. The warning has sparked widespread debate about Canada-US trade relations and the future of North American economic cooperation.

What Mark Carney Said

Addressing the issue, Carney clarified Canada’s position under the Canada-US-Mexico Agreement (CUSMA).

“Under CUSMA, we are required to give notice before entering into any free trade agreement with a non-market economy. We have no intention of doing such trade with China or any other similar country,” Carney said.

This clear message was aimed at calming concerns in Washington while reinforcing Canada’s commitment to existing trade frameworks.

Trump’s Tariff Threat and Strong Rhetoric

President Trump, in a series of social media posts, accused Canada of potentially becoming a gateway for Chinese goods into the US. He warned that China would “harm Canada’s business, society, and lifestyle” and claimed that any Canada-China FTA would trigger immediate and severe trade penalties.

Trump also linked his anger to Carney’s opposition to the proposed Golden Dome missile defense project, further escalating diplomatic tensions between the two neighbors.

Canada-China Trade: What’s Really Happening?

While Canada insists there is no formal FTA with China, recent developments have raised eyebrows in Washington. During Carney’s visit to China from January 13 to 17, several trade-related agreements were signed, including:

Reduction of tariffs on Chinese electric vehicles (EVs) from 100% to 6.1%

Annual import cap of 49,000 EVs, potentially rising to 70,000

China cutting retaliatory tariffs on Canadian agricultural products from 84% to 15%, with possible zero tariffs later this year

Experts say these steps are more about trade normalization than a strategic shift.

Why Canada-US Trade Still Matters Most

Despite the noise, Canada-US trade relations remain the backbone of Canada’s economy:

 Daily trade worth nearly ₹15,000 crore

 Total bilateral trade of around ₹79 lakh crore in 2024

 USMCA allows duty-free access for about 81% of imports

 Canada supplies major energy resources, auto parts, timber, and farm goods to the US

Canada also depends heavily on the US for technology, machinery, medicines, and consumer products.

Bigger Picture: Politics, Security, and Sovereignty

Trump’s repeated comments about making Canada the 51st state of the US and his Greenland-linked Golden Dome ambitions have added political strain. Carney has firmly rejected these ideas, stating that “Canada is not for sale.”

A Delicate Balancing Act

The statement that there are no plans to pursue an FTA with China reflects Canada’s effort to balance economic interests with strategic alliances. As global trade becomes increasingly politicized, Canada appears focused on protecting its sovereignty while preserving its most critical partnership—with the United States.

For now, Ottawa’s message is clear: cooperation yes, confrontation no—but not at the cost of national interest.

Indian equity markets witnessed a brutal selloff on Thursday, with the Sensex plummeting over 800 points and the Nifty 50 crashing below the 25,900 mark in their worst single-day performance in a month. The dramatic plunge was triggered by geopolitical tremors from Washington, where former U.S. President Donald Trump greenlit a bipartisan bill threatening to impose catastrophic tariffs of up to 500% on nations, including India, for purchasing Russian oil.

The "Sanctioning Russia Act of 2025," championed by Senator Lindsey Graham, aims to choke off financing for Moscow’s military operations by punishing its oil customers. For India, which emerged as a major buyer of discounted Russian crude after the Ukraine war began, the threat strikes at a core economic interest. The market's violent reaction—with the India VIX fear gauge spiking 7%—signals deep anxiety over a potential fresh trade war and its impact on corporate earnings and economic growth.

The Geopolitical Trigger: More Than Just Tariffs

The timing of Trump's move is strategically pointed. It comes just days before U.S. Ambassador-designate Sergio Gor is set to take up his post in New Delhi, who has previously stated that ending India's Russian oil imports is a "top priority". This isn't an isolated pressure tactic. In a double blow, the Trump administration also announced its withdrawal from the India-led International Solar Alliance (ISA), a key multilateral initiative.

This one-two punch suggests a tougher, more transactional stance from Washington, forcing a recalculation of long-held assumptions about India's strategic balancing act. Market experts like Sugandha Sachdeva of SS WealthStreet note the selloff is the market "discounting the fear" of these punitive tariffs, which could severely impact Indian refiners and the broader energy sector.

Market Carnage: A Sector-Wide Bloodbath

The selling pressure was broad-based and severe:

Heavyweight Dragged Down: Major index contributors like Reliance Industries (RIL) and technology stocks came under fire. RIL alone has shed nearly ₹2 trillion in market capitalization from its January high.

Sectoral Rout: Metal stocks were hit hardest, with the Nifty Metal index collapsing nearly 3%. Public sector banks (PSU Banks) and IT sectors also fell sharply.

Global Ripple Effects: The anxiety mirrored in Asian markets, where Japan's Nikkei tumbled 1.6%, though other global indices were more subdued.

Domestic Institutions: The Lone Buffer Against the Storm

Amidst the foreign-instigated storm, a familiar pattern held steady: Domestic Institutional Investors (DIIs) continued to be the bedrock of support. On January 7, while Foreign Institutional Investors (FIIs) sold shares worth ₹1,527 crore, DIIs were net buyers to the tune of ₹2,889 crore. This trend has been consistent for months, with DIIs injecting over ₹79,600 crore in December 2025 alone, countering FII outflows.

This massive domestic liquidity has so far prevented a deeper correction, highlighting a fundamental shift in market ownership and resilience.

A Silver Lining: The Bharat Coking Coal IPO Opens Tomorrow

In a contrasting narrative of domestic economic strength, the primary market presents a major opportunity. The Bharat Coking Coal Limited (BCCL) IPO, a subsidiary of Coal India, opens for subscription on January 9.

The Offer: A ₹1,071 crore Offer for Sale (OFS), with a price band of ₹21-₹23 per share.

Strong Sentiment: Grey market premiums (GMP) suggest a listing pop of around 50%, indicating robust demand.

Shareholder Benefit: A 10% quota is reserved for existing Coal India shareholders as of January 1, 2026, rewarding loyal investors.

The Road Ahead for Investors

Today’s crash is a stark reminder that in an interconnected world, domestic market fundamentals can be swiftly overridden by global geopolitical shocks. The immediate future hinges on the passage of the U.S. bill and subsequent diplomatic negotiations.

For investors, the strategy remains one of cautious selectivity. The relentless support from DIIs provides a floor, but sectors directly in the crosshairs of trade tensions—like oil marketing companies and metals—may face continued volatility. Meanwhile, the robust appetite for the BCCL IPO underscores the ongoing confidence in India's domestic growth story and public sector value unlocking, offering a timely counter-narrative to the day's bleak headlines.