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Modi calls Trump tariffs ‘unjustified’, unveils tax cut incentives

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Modi calls Trump tariffs ‘unjustified’, unveils tax cut incentives



Indian Prime Minister Narendra Modi’s plan to reduce consumption taxes on everyday goods could provide billions of dollars in annual relief and stimulate demand in an economy preparing for potential US tariffs, experts say.

US President Donald Trump has warned he may double import duties on India from 25% to 50% in response to New Delhi’s purchase of Russian oil, arguing such transactions help Moscow finance its war in Ukraine.

The threat has cast uncertainty over the outlook for the world’s fifth-largest economy, with Indian exporters cautioning about declining orders and significant job losses.

Calling Washington’s move “unfair, unjustified and unreasonable,” New Delhi is working to cushion the impact.

Modi, during his recent Independence Day address, pledged to “reduce the tax burden on the common man.”

The proposed cuts to the goods and services tax (GST) would make items ranging from small cars to air conditioners more affordable for consumers, according to economists.

Currently, the GST functions under a four-tier structure, with rates spanning from five to 28%. Under Modi’s plan, most goods would be simplified into just two categories, taxed at either five or 18%.

The Indian leader has called the change a “Diwali gift”, a reference to the annual Hindu festival of lights when consumers splurge on everything from gold and clothes to consumer electronics.

‘Sizeable savings’
Trump’s tariffs — and their impact on ordinary Indians will hinge on how much progress is made towards a Russia-Ukraine peace deal, and whether New Delhi can secure alternative oil suppliers before the US president’s August 27 deadline.

But experts say Modi’s tax reform could help shore up demand by reducing tax collections by between $13 billion and $17 billion.

Analysts at Emkay Global Financial Services called the policy a “welcome reform towards boosting domestic consumption”.

They estimated that about the vast majority of items currently subject to the top 28% rate would be taxed at 18%, while “nearly all” in the 12% tier would move into the 5% bracket.

Analysts at Motilal Oswal, an Indian financial services firm, said the changes would bring benefits to a wide range of sectors and “sizeable savings” to households.

The fate of the proposal ultimately rests with the GST Council, which includes representatives from state governments and has struggled to achieve broad consensus in the past.

If approved, the cuts would strain public finances, according to experts.

However, they said, they could also help to offset tariff risks and burnish Modi’s credentials among the middle class.

The proposal comes ahead of expected elections later this year in Bihar, a large, Hindu-majority state of 130 million people that is a key political battleground for Modi.

“The popular economic narrative right now is that of Trump’s 50% tariffs and how the US-India relationship is seeing setbacks,” Deepanshu Mohan, economist at OP Jindal Global University, told AFP.

“The GST readjustment is a strong response from Modi in that context. It’s Modi telling the middle class: ‘We are trying to make sure you have enough at your end,'” Mohan said.

But, he added, it was also an acknowledgement that India’s economy had not worked for its “low middle-income class for some time”.

US-India Trade Tensions

Although economists have long urged an overhaul of the GST framework, Modi’s unexpected announcement comes at a time when US-India relations have sunk to a multi-decade low.

Experts warn that without a trade agreement, Trump’s proposed tariffs could push India’s GDP growth below 6% this fiscal year lower than the Reserve Bank of India’s projection of 6.5%.

India’s position on Russian oil imports will become clearer by late September, as most of this month’s shipments were contracted before Trump’s threats, according to trade intelligence firm Kpler.

Kpler analyst Sumit Ritolia told AFP that while Indian refiners are showing “growing interest” in US, West African, and Latin American crude, this reflects “greater flexibility, not a deliberate pivot.”

“Unless there is a clear policy shift or a sustained change in trade economics, Russian supplies will remain a central part of India’s crude basket,” Ritolia added.

Meanwhile, the outlook for US-India trade talks remains uncertain as the tariff deadline draws closer.

New Delhi insists it is committed to reaching a deal, but Indian media reports suggest Washington has postponed a planned late-August negotiating visit to New Delhi.



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Climate tipping points are being crossed, scientists warn ahead of COP30

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Climate tipping points are being crossed, scientists warn ahead of COP30


Bleached coral is seen in a reef at the Costa dos Corais in Japaratinga in the state of Alagoas, Brazil April 16, 2024. — Reuters
Bleached coral is seen in a reef at the Costa dos Corais in Japaratinga in the state of Alagoas, Brazil April 16, 2024. — Reuters

Global warming is crossing dangerous thresholds sooner than expected with the world’s coral reefs now in an almost irreversible die-off, marking what scientists on Monday described as the first “tipping point” in climate-driven ecosystem collapse.

The warning in the Global Tipping Points report by 160 researchers worldwide, which synthesises groundbreaking science to estimate points of no return, comes just weeks ahead of this year’s COP30 climate summit being held at the edge of the Amazon rainforest in Brazil.

That same rainforest system is now at risk of collapsing once the average global temperature warms beyond just 1.5 degrees Celsius based on deforestation rates, the report said, revising down the estimated threshold for the Amazon.

Also of concern if temperatures keep rising is the threat of disruption to the major ocean current called the Atlantic Meridional Overturning Circulation, or AMOC, which helps to ensure mild winters in northern Europe.

“Change is happening fast now, tragically, in parts of the climate, the biosphere,” said environmental scientist Tim Lenton at the University of Exeter, who is the lead author of the report.

Some positive signs

Lenton noted positive signs when it came to phasing out the fossil fuels most responsible for climate change. Renewables, for example, accounted for more electricity generation than coal this year for the first time, according to data from the nonprofit think tank Ember.

“Nobody wants to be just traumatised and disempowered,” Lenton said. “We still have some agency.”

A drone view shows bleached corals on the reef at the Costa dos Corais, in Japaratinga, in the State of Alagoas, in Brazil, April 16, 2024. — Reuters
A drone view shows bleached corals on the reef at the Costa dos Corais, in Japaratinga, in the State of Alagoas, in Brazil, April 16, 2024. — Reuters

The scientists implored countries at November’s COP30 to work toward bringing down climate-warming carbon emissions.

Scientists have been surprised by how quickly changes are unfolding in nature, with average global temperatures already having warmed by 1.3-1.4 degrees Celsius (2.3 to 2.5 degrees Fahrenheit) above the preindustrial average, according to data from U.N. and EU science agencies.

Warmest on record

The last two years were Earth’s warmest on record, with marine heatwaves that stressed 84% of the world’s reefs to the point of bleaching and, in some cases, death. Coral reefs sustain about a quarter of marine life.

For corals to recover, the world would need to drastically ramp up climate action to reverse temperatures back down to just 1 degree C above the preindustrial average, the scientists suggested.

“The new report makes clear that each year there is an increase in the scope and magnitude of the negative impacts of climate change,” said Pep Canadell, a senior scientist at Australia’s CSIRO Climate Science Centre.

The world is currently on track for about 3.1 degrees C of warming in this century, based on national policies.





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Trump vows to ‘solve’ Pakistan-Afghanistan tensions after Middle East trip

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Trump vows to ‘solve’ Pakistan-Afghanistan tensions after Middle East trip


US President Donald Trump gives a thumbs up while boarding Air Force One, as he departs for Israel, at Joint Base Andrews, Maryland, US, October 12, 2025. — Reuters
US President Donald Trump gives a thumbs up while boarding Air Force One, as he departs for Israel, at Joint Base Andrews, Maryland, US, October 12, 2025. — Reuters
  • Says Gaza ceasefire will be the eighth conflict he has helped end.
  • Claims resolving India-Pakistan dispute within 24hrs using tariffs.
  • Stresses he didn’t act for the Nobel Peace Prize but to “save lives.”

US President Donald Trump on Sunday said he was aware of the escalating tensions between Pakistan and Afghanistan, claiming he would address the situation once he returns from the Middle East, as he described himself as “good at solving wars.”

Trump, who reiterated his claim of having resolved several long-standing global conflicts, including the dispute between India and Pakistan, said the Gaza ceasefire would be the eighth conflict he has helped end.

“This will be my eighth war that I have solved, and I hear there is a war now going on between Pakistan and Afghanistan. I said, I’ll have to wait till I get back. I am doing another one. Because I am good at solving wars,” Trump told reporters aboard Air Force One as he began a flight from Washington to Israel.

“Think about India, Pakistan. Think about some of the wars that were going on for years. We had one going for 31, one going for 32, one going for 37 years, with millions of people being killed in every country, and I got every one of those done, for the most part, within a day. It’s pretty good…,” he added.

Trump also spoke about the Nobel Peace prize, stating, “It’s an honour to do it. I saved millions of lives. In all fairness to the Nobel committee, it was for 2024. 

“This was picked for 2024. But there are those who say you could make an exception because a lot of things happened during 2025 that are done and complete and great. But I did not do this for the Nobel. I did this for saving lives.”

He also took credit for resolving some disputes by leveraging economic tools like trade and tariffs.

“I settled a few of the wars just based on tariffs. For example, between India and Pakistan, I said, if you guys want to fight a war and you have nuclear weapons, I am going to put big tariffs on you both, like 100%, 150%, and 200%. I said I am putting tariffs. I had that thing settled in 24 hours. If I didn’t have tariffs, you could have never settled that war,” Trump added.

Trump is due to arrive in Israel on Monday (today) to address the Knesset, the parliament, before travelling to Sharm El Sheikh in Egypt for a world leaders’ summit on ending the Gaza war.

Palestinian Authority President Mahmoud Abbas will also attend the summit, an Axios reporter said on Sunday, citing a senior Palestinian official.

Trump’s envoy Steve Witkoff and Jared Kushner addressed a rally in Tel Aviv on Saturday, which many Israelis hoped would be the final one, urging the release of hostages and an end to the war.

The US, along with Egypt, Qatar and Turkey, mediated what has been described as a first-phase agreement between Israel and Hamas for a ceasefire and the release of hostages by Hamas and prisoners and detainees by Israel.

“For two years we (have been) waiting for this day for this moment… All of us feel happy for the family, for the hostages, that finally…we will see them,” said demonstrator Dalia Yosef, thanking Trump.





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Trump says US ‘wants to help China, not hurt it’

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Trump says US ‘wants to help China, not hurt it’


US President Donald Trump and Chinas President Xi Jinping shake hands ahead of their bilateral meeting during the G20 leaders summit in Osaka, Japan, June 29, 2019.— Reuters
US President Donald Trump and China’s President Xi Jinping shake hands ahead of their bilateral meeting during the G20 leaders summit in Osaka, Japan, June 29, 2019.— Reuters
  • US president says Xi doesn’t want depression for his country.
  • Washington ratcheted up economic measures against Beijing.
  • Rare earths are major striking point between two superpowers.

President Donald Trump said on Sunday the United States wants to help China, not hurt it, striking a conciliatory tone days after threatening an additional 100% tariff on the world’s second-largest economy.

Trump’s statements on Friday, as well as his threat to cancel a meeting with Xi later this month, sent Wall Street stocks tumbling into negative territory as traders worried the trade war between Washington and Beijing could reignite.

“The U.S.A. wants to help China, not hurt it!!!” Trump said in Sunday’s post on Truth Social, adding that “respected President Xi (Jinping)… doesn’t want Depression for his country.”

Trump on Friday said that he would impose the extra levies from November 1 in response to what he called “extraordinarily aggressive” new Chinese export curbs on the rare-earths industry.

Beijing, in turn, accused Washington of acting unfairly, with its Ministry of Commerce on Sunday calling Trump’s tariff threat a “typical example of ‘double standards’.”

The ministry said Washington had ratcheted up economic measures against Beijing since September.

“Threatening high tariffs at every turn is not the right approach to engaging with China,” it said in an online statement.

Chinese goods currently face US tariffs of 30% under levies that Trump imposed while accusing Beijing of aiding in the fentanyl trade as well as unfair trade practices.

China’s retaliatory tariffs are currently at 10%.

Rare earths have been a major sticking point in recent trade negotiations between the two superpowers.

They are critical to manufacturing everything from smartphones and electric vehicles to military hardware and renewable energy technology but produced and processed almost exclusively by China.





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