Amidst escalating trade tensions between the United States and India, President Donald Trump has suggested a possible softening of his stance regarding additional tariffs on India for its continued purchase of Russian oil. This comes after the Trump administration imposed a 25% duty on Indian imports on August 7, followed by an additional 25% levy on Indian oil purchases from Russia, effectively raising the total tariff burden on Indian goods to 50%. The second round of duties is scheduled to take effect on August 27.
Trump's recent remarks have introduced an element of uncertainty, hinting that the U.S. may not proceed with these additional secondary tariffs. While he acknowledged India's reduced oil purchases from Russia, he also pointed out China's continued significant intake. When questioned about the disparity in treatment between India and China, Trump alluded to potential future actions, stating, "You're going to see a lot more...You're going to see so much secondary sanctions". He has also warned that if no moves are made to end the war in Ukraine, such measures could be implemented in the coming weeks.
This potential shift in approach follows a meeting between President Trump and Russian President Vladimir Putin in Alaska, which Trump described as "very productive". However, he also conceded that some important issues remained unresolved, and no formal agreement had been reached. Prior to the summit, Trump suggested that the tariffs already imposed on India were impacting Moscow by costing it a key customer. "Well, they lost an oil client so to speak, which is India," he stated.
The initial decision to impose tariffs on India was met with strong criticism from New Delhi, with many viewing the move as "unfair". The tariffs have further strained the relationship between the two countries. Some analysts suggest that Trump's actions are driven by personal frustrations rather than clear economic or geopolitical goals. Others point to India's reluctance to make trade concessions on agriculture, dairy, and seafood as a contributing factor.
Despite the current tensions, the U.S. remains a key long-term partner for India. Bilateral trade between the two countries stood at approximately $212 billion last year, with a trade gap of about $46 billion in India's favor. Prime Minister Modi has previously stated his intention to more than double trade between the two countries to $500 billion in the next five years. In line with this goal, India has also drastically increased its energy purchases from the United States, with crude oil imports surging 51% in the first half of 2025.
Whether President Trump will follow through with additional tariffs on India remains to be seen. His recent statements suggest a degree of flexibility, potentially influenced by the outcome of trade negotiations or the evolving geopolitical landscape. The situation is still developing, and further developments are expected in the coming weeks.
