(qlmbusinessnews.com . Thu 7th Aug, 2025) London, UK —
US-India Trade Tension Escalates: Trump Announces Hefty Tariffs in Response to Russian Oil Purchases
US President Donald Trump Has Slapped India with a Hefty Tariff Increase over Russian Oil Purchases
In a bold move escalating trade tensions, US President Donald Trump has announced a significant executive order imposing an additional 25% tariff on India due to its continued purchases of Russian oil. This hike propels the total tariff on Indian imports to a staggering 50%, marking one of the highest rates the US has applied.
The tariff is set to take effect in 21 days, landing on the 27th of August, as detailed in the executive directive.
Reacting to the announcement, India's Foreign Ministry voiced its displeasure on Wednesday, stating that its position regarding imports from Russia had been previously communicated, denouncing the new tariff as “unfair, unjustified, and unreasonable”.
“It is profoundly regrettable that the US has decided to impose additional tariffs on India for adopting measures that various other countries are taking in their self-interest,” the ministry's succinct statement expressed.
The ministry further vowed that “India will undertake all necessary measures to safeguard its national interests.”
President Trump had earlier criticized India for its indifference towards the Ukrainian crisis, exacerbated by Russia's military involvement, stating that India doesn't “care how many people in Ukraine are being killed by the Russian War Machine.”
In defence of the tariff imposition, the White House justified the action on Wednesday, asserting that “The Russian Federation's actions in Ukraine pose an ongoing threat to US national security and foreign policy, necessitating more robust measures to tackle the national emergency.”
Highlighting the undermining effect of India's Russian oil imports on US initiatives to counteract Russia's aggression in Ukraine, the statement announced plans to evaluate other countries' Russian oil import activities and “recommend further actions to the President as needed.”
Major buyers of Russia's prominent oil and gas exports include nations like China, India, and Turkey.
At a subsequent White House event, when queried by the Reporters on the matter, President Trump intimated that the tariff on India was merely an initial step, forewarning of “a lot more, so much secondary sanctions.”
This comes amidst diplomatic endeavours, notably Wednesday's discussions in Moscow by Trump's top envoy, Steve Witkoff, aimed at brokering peace between Russia and Ukraine.
The imposition of this additional tariff could severely impact key Indian export sectors—including textiles, gems and jewellery, auto parts, and seafood—introducing a hefty 50% duty and affecting crucial employment sectors. However, electronics, including iPhones, and pharmaceuticals are temporarily exempted.
Prior criticisms by Delhi targeted Trump's threats of raising tariffs over oil purchases from Russia as “unjustified and unreasonable,” with a reminder that the US had initially encouraged India's Russian gas imports “for strengthening global energy market stability.”
This latest tariff threat underscores Trump's readiness to leverage sanctions related to the Ukrainian conflict, even against significant allies or trade partners, signalling potential further measures unless there's a change in course.
With prior instances of the Trump administration implementing secondary tariffs—such as those aimed at Venezuelan oil purchasers—this development marks a notable escalation in trade hostilities.
Despite the substantial trade between India and the US, Trump's administration has not shied away from imposing these heavy levies, pointing to diverging interests between New Delhi and Washington.
The Federation of India Export Organisations has expressed astonishment at the decision, estimating a potential hit to 55% of India’s exports to the US.
Experts like Ajay Srivastava, former Indian trade official and head of the Delhi-based think tank Global Trade Research Initiative (GTRI), advises calm and restraint, suggesting India avoids retaliation and acknowledges that “meaningful trade negotiations with the US cannot proceed under threats or mistrust.”
This development is likely to strain the trade dynamics between India and the US further, impacting a wide array of industries and potentially altering global trade patterns.
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