The global trade landscape is witnessing increasing friction as the administration of Donald Trump is employing tariffs as a tool to achieve its economic and geopolitical objectives, with India finding itself in the crosshairs of a three-front tariff war. Simultaneously, NATO Chief Mark Rutte has threatened India with potential sanctions over its continued trade relations with Russia, particularly concerning oil imports.
Trump's stance on trade with India has been critical, labeling it a "tariff king" due to its relatively higher tariff rates compared to the United States. This has led to a series of actions aimed atPressuring India to reduce its tariffs and open its markets further to American goods. In April 2025, the Trump administration imposed a 26% tariff on imports from India, which was later paused for 90 days, with a 10% blanket tariff remaining in effect. Trump has also warned of "reciprocal" tariffs if a trade deal is not reached. While India has made some concessions, such as lowering import duties on bourbon whiskey and Harley-Davidson motorcycles, these measures may not be enough to satisfy the demands of the US administration. Trump has teased a deal with India since late June, though his repeated talk about brokering peace between India and Pakistan this spring has complicated U.S.-India relations and may make it harder for Prime Minister Narendra Modi to sell the deal domestically.
Adding another layer of complexity, NATO Secretary-General Mark Rutte has cautioned India, along with China and Brazil, against continuing trade with Russia, particularly in the energy sector. Rutte warned of potential "100% secondary sanctions" if these countries do not pressure Russian President Vladimir Putin to engage in serious peace talks regarding the conflict in Ukraine. This threat has been met with strong opposition from India, which has asserted its right to secure its energy needs based on market dynamics and prevailing global circumstances. India has also cautioned against "double standards," pointing out that some European countries continue to import Russian oil, either directly or through third-party countries. Ministry of External Affairs spokesperson Randhir Jaiswal said that India's domestic needs depend on the current market scenario and geopolitical conditions, and warned the West against adopting any "double standards".
India has been one of the major buyers of Russian crude oil since Western sanctions were imposed on Moscow for its invasion of Ukraine. While the EU has significantly reduced its reliance on Russian oil, some European countries still import Russian oil, either directly or through third-party countries. According to Foreign Policy, Slovakia, Hungary, Austria, and Spain were among the top countries depositing the most money into Russian accounts for fossil fuels in 2024. Additionally, some Russian crude oil is processed into fuels like petrol and diesel in India and then exported to Europe.
Navigating these challenges requires a delicate balancing act for India. On one hand, it needs to protect its economic interests and ensure access to affordable energy sources. On the other hand, it must manage its relationships with key global powers like the United States and NATO member states. India is also keeping an active track on the possible tariff differentials that will come about as a result of Donald Trump administration's August 1 duties move. India's response has been to assert its strategic autonomy, emphasize its focus on national interests, and call for fair and consistent treatment from the international community. India has also indicated its openness to revive trilateral talks with Beijing and Moscow.
