📦 Trump Tariffs Hit India—25% Starts Tomorrow

☀️ Good morning! It’s Thursday aka Friday Junior, and the tariff tension is piping hot.

The US president is raining down tariffs and penalties like confetti. But India’s standing its ground, markets are nervy, Tata Motors is betting big on Europe, and Google is trying to play nice with desi gamers. Grab your cup—today’s brew is bold, detailed, and anything but decaf.

Let’s get steeped! 👇

🫖 Chai Shots

• 📦 Trump Hits India with 25% Tariff and Mystery Penalty: The U.S. President has slapped a 25% tariff on all goods imported from India starting August 1 and hinted at an additional penalty tied to India’s trade with Russia. He says India’s tariffs are among the highest globally and wants Delhi to open up its markets—especially agriculture and defense. More in the Big Brew 👇

• 🪙 Rupee Sinks to 5-Month Low, RBI Expected to Step In: The rupee fell sharply to 87.42 per dollar, its worst single-day performance in three months. Traders expect it to test the 88 level, where the RBI is likely to intervene. Concerns over FDI outflows, rising crude prices, and US sanctions are weighing heavily on sentiment.

• 🚚 Tata Motors Strikes $4.4B Iveco Deal—Its Largest Global Buy: In a bold move to expand its commercial vehicle footprint globally, Tata Motors will acquire 100% of Italy’s Iveco. The deal gives Tata access to EV and hydrogen tech, but comes with integration and margin risks as Tata prepares to list its CV unit independently.

• 📈 Meta Stock Jumps 10% After Blowout Q2 Earnings: Meta posted $47.5B in revenue—well above Wall Street forecasts—and expects even more next quarter. CEO Mark Zuckerberg credited AI tools for improving ad performance, while Reality Labs continued to bleed money. Meta’s daily user base across apps hit 3.48 billion.

📊 Market Masala

• 📊 Sensex Rises 144 Points, Nifty Holds 24,850: Indian equity indices ended higher on Wednesday with the Sensex inching up 144 points and the Nifty closing above the 24,850 mark, buoyed by strong earnings from L&T and gains in IT, FMCG, and consumer durables. Investor caution lingered ahead of the US Fed's rate decision and India-US trade talks.

• ✈️ IndiGo Q1 Profit Slides 20%, Hit by Softer Yields: IndiGo reported ₹2,176 crore in net profit, down 20% YoY. A 5% drop in yield and a dip in load factor to 84.6% dragged margins, but strong passenger growth—31 million flyers this quarter—offered some cushioning.

• 🚫 SEBI Bars Gensol’s Jaggi Brothers from Market Roles: The market regulator has upheld its earlier ban on the Jaggi brothers—promoters of Gensol and related to BluSmart—amid ongoing financial probe. Both Gensol and BluSmart are facing bankruptcy proceedings.

🌎 Global Masala

• 💸 Fed Keeps Rates Unchanged, Still Sees Two Cuts in 2025: The Fed held its benchmark rate steady at 4.25%–4.50%, with Powell stating the current stance is “moderately restrictive.” The central bank removed its warning on rising inflation and unemployment but emphasized that uncertainty remains high.

• 📉 Wall Street Ends Lower as Powell Damps Rate Cut Hopes: The S&P 500 fell 0.13%, while the Dow dropped 171 points after Powell said the Fed hadn’t made any decision on a September rate cut. Traders reacted to concerns that tariffs could stoke inflation and delay policy easing.

• 🦷 Align Technology Slashes Forecast, Stock Drops 30%: The maker of Invisalign clear aligners cut its 2025 growth outlook, citing weak demand and macro uncertainty. It plans layoffs and expects $170M in restructuring costs. Analysts were disappointed with both revenue and EPS misses.

☕ The Big Brew: Trump Turns Up the Heat, But Talks With India Aren’t Over Yet

Just hours after announcing a 25% tariff on Indian exports and threatening an additional penalty over Russia ties, U.S. President Donald Trump signaled that negotiations with India are still underway—and could lead to a trade breakthrough by week’s end.

The situation is fast-evolving, but here’s what we know:

• 🇺🇸 Tariff Triggered: The 25% tariff on Indian goods is scheduled to kick in August 1, making India one of the most heavily penalized U.S. trading partners—more so than Vietnam (20%), Indonesia (19%), or even the EU (15%).

• 🪖 Penalties & Politics: The White House has kept details of the "unspecified penalty" vague, but Trump cited India’s energy and defense purchases from Russia, and its participation in BRICS—an alliance he deems “anti-American”—as major sticking points.

• 🧀 Dairy Dilemma: U.S. negotiators continue to push for access to India's tightly guarded agricultural and dairy sectors. India, however, reiterated that protecting farmers and MSMEs is non-negotiable.

• 💬 Still Talking: Speaking at the White House, Trump said India was “willing to cut [tariffs] very substantially” and hinted that the talks could yield results by week’s end. India confirmed the dialogue is active and emphasized its commitment to a fair, mutually beneficial trade deal.

• 📉 Export Pressure: The new tariffs could deal a blow to India’s $87B annual exports to the U.S., especially in textiles, footwear, pharma, and gems—industries that now face intensified competition from Vietnam and China.

• 📦 Why Now?: The tariff move comes just ahead of Trump’s self-imposed deadline for reciprocal trade agreements with multiple countries. India has been in multiple rounds of negotiation with the U.S., but progress has slowed amid widening trust issues and geopolitical crosswinds.

• 🤝 Strategic Setback: With both countries earlier targeting $500B in bilateral trade by 2030, this week’s developments are a stark contrast. Political tensions and disputes over non-tariff barriers—have further complicated matters.

What does this mean?

While the tariff clock is ticking, the door isn’t shut just yet. The U.S. and India are still at the table, with Delhi holding firm on its red lines and Washington pressing hard for market access. But if no compromise emerges soon, Indian exporters could face immediate pain—just as global trade faces a new wave of uncertainty.

The week’s not over… but the heat is on.

🚀 Startup Scoop

• 💊 Blinkit Begins 10-Minute Prescription Delivery in Bengaluru: Blinkit is now delivering antibiotics, nasal sprays, and more in select pin codes, along with free post-order doctor consults. The pilot mirrors moves by Swiggy and PhonePe into hyper-fast health delivery.

• 🥛 Desi Farms Buys Suruchi Dairy in ₹130 Cr All-Cash Deal: Pune-based Desi Farms is taking full control of the 28-year-old dairy giant. The deal is funded through ₹100 Cr from family offices and angel investors, giving Desi Farms a national processing footprint.

• ⚡ Baaz Bikes Raises ₹19 Cr from Existing Investors: The EV startup that leases scooters to gig workers at Zepto and Swiggy raised new funds from Big Capital, Rakuten Capital, and Kalaari Capital. Post-money valuation: ₹278 Cr.

• 💵 Flexprice Raises $500K to Simplify AI Billing: The open-source billing platform for AI and API companies closed its seed round with backing from TDV Partners and top angel investors. It offers modular pricing models and real-time dashboards for AI-first businesses.

🤯 Chai Break Trivia

⏰ Did you know the snooze button on alarm clocks is always 9 minutes long (on purpose)?

It’s a tech tradition dating back to mechanical clocks. Engineers couldn’t fit a full 10-minute snooze gear, so they went with 9—and it stuck.

🔮 What’s Brewing Next

• 👕 Exporters Brace for Fallout: Garment and footwear exporters are revising pricing models in real-time as the 25% tariff looms. Industry associations are likely to lobby for relief measures if a trade deal fails to materialize.

☕ That’s your Thursday brew!

From tarriff tantrums to Tata’s Euro ambitions, today's Masala Chai was strong, spicy, and full of headlines that’ll have you raising eyebrows and your INR hedges. Until tomorrow—stay caffeinated, stay informed, and never underestimate the power of a well-brewed news drop.

Steeping off now! ☕