A new trade deal between India and the United States is under scrutiny due to conflicting statements regarding India's commitment to purchasing Russian oil. White House Press Secretary Karoline Leavitt announced on Tuesday that India had pledged to cease Russian oil imports and increase purchases from the United States, a move she attributed to direct talks between President Donald Trump and Prime Minister Narendra Modi.
Leavitt stated that this agreement would benefit American workers and industries, also suggesting India could explore oil imports from Venezuela, where Washington oversees key aspects of the oil trade. She highlighted this as a political breakthrough linked to the new trade terms between the two countries. Leavitt also noted Prime Minister Modi's commitment to $500 billion in investments across various American sectors, including transportation, energy, and agriculture.
However, these assertions were countered in the Indian Parliament by Harsh Vardhan Shringla, a nominated Member of Parliament and former Foreign Secretary. Shringla clarified that India's crude oil purchases depend on price and quality considerations, not governmental directives. He emphasized that India has been strategically diversifying its oil sources to reduce reliance on any single region. Shringla noted that while India has been importing 30-40% of its oil from Russia for the past four years, these imports have been declining in recent months. This decrease, he explained, is due to the reduced price difference between Russian oil and other sources, as well as the increasing impact of sanctions on Russia.
Shringla highlighted that Indian companies and refineries make decisions based on the price, suitability, and quality of oil available. He also mentioned India's historical oil purchases from Venezuela, which amounted to $6 billion before 2020, suggesting that India would be open to resuming these purchases if the oil is available in the international market. Shringla pointed out that India relies on imports for 80% of its oil needs and must strategically balance its purchases to avoid over-dependence on any one region, such as the Gulf or Russia. He said that this strategic decision allows India to consider oil purchases from the United States, Brazil, Guyana, and other countries.
The India-US trade deal has been lauded by Shringla as the "father of all deals," with the potential to double trade between the two nations to $500 billion. He emphasized that the agreement would provide Indian exporters access to a vast $60 trillion market, benefiting small-scale industries. Despite pressures during negotiations, the Indian government prioritized the protection of its agriculture and dairy sectors.
The contrasting statements from White House Press Secretary Karoline Leavitt and MP Shringla highlight differing understandings of the terms and implications of the new trade deal, particularly concerning India's energy strategy. While the White House emphasizes a commitment to reduce Russian oil imports, the Indian perspective underscores a continued focus on economic factors and diversification in oil sourcing.