U.S. Vice President JD Vance has stated that President Donald Trump strategically used tariffs on India as a tool to pressure Russia into ending the war in Ukraine. Vance described this approach as "aggressive economic leverage," designed to diminish Russia's revenue from its oil exports.
In an interview on NBC News' "Meet the Press," Vance explained that Trump's strategy involved "secondary tariffs on India" to make it more difficult for Russia to profit from its oil economy. He conveyed that Trump aimed to make it clear to Russia that reintegration into the global economy was possible if it ceased hostilities, but continued isolation would be the consequence of continued aggression.
The Trump administration had been critical of India's increased procurement of discounted Russian crude oil following Western sanctions on Moscow after the Ukraine invasion in February 2022. India has consistently maintained that its energy decisions are based on national interest and market conditions. Despite the criticism, India has emphasized its need for affordable energy resources to fuel its growing economy.
Since Trump doubled tariffs on Indian goods to 50%, which included a 25% levy on India's Russian crude oil purchases, trade relations between New Delhi and Washington have deteriorated. The U.S. has alleged that India's purchases of Russian crude oil are funding Moscow's war in Ukraine, a charge strongly rejected by India. New Delhi turned to purchasing Russian oil sold at a discount after Western countries imposed sanctions on Moscow.
The increase in tariffs has raised concerns about the impact on India's export sectors and job market. According to the Global Trade Research Initiative (GTRI), India's overall exports to the U.S. could decline by nearly 30%, potentially affecting key export-oriented sectors that employ many young workers.
The Federation of Indian Export Organisations (FIEO) has advocated for credit assistance, risk management, and cost reduction to handle the challenges posed by the tariffs. They have also recommended a one-year moratorium on loan repayments, as the high tariffs might lead to decreased orders or extended payment periods, putting pressure on exporters' cash flows. The Indian government is reportedly considering sector-specific measures to cushion the impact on exporters and small and medium enterprises.
Despite the strain in trade relations, Vance expressed optimism about the possibility of a breakthrough in the Ukraine conflict. He noted that the U.S. believes they've already seen some significant concessions from both sides.
It's noteworthy that while the U.S. has been critical of India's oil imports from Russia, China, the largest importer of Russian crude oil, has largely avoided similar scrutiny from the Trump administration.
Meanwhile, India announced a temporary suspension of most international postal services to the U.S., effective August 25, 2025, in response to regulatory changes. This action follows the U.S. administration's withdrawal of the de minimis exemption for goods valued up to $800.
