Breaking News: Trump Escalates Trade Pressure on India
On August 4, 2025, former U.S. President Donald Trump announced plans to “substantially” raise tariffs on Indian imports, citing New Delhi’s continued purchases and alleged resale of Russian oil at profit—accusations he claims enabled India to disregard the humanitarian crisis in Ukraine S&P Global+9Reuters+9New York Post+9.(Raise Tariffs On India Over Russian Oil)
This announcement follows an earlier decision to impose a 25% flat tariff on Indian goods, effective August 1, along with an undefined penalty tied to India’s defence and energy dealings with Russia The Times of India+4The Indian Express+4India Today+4.
📊 India’s Heavy Dependence on Russian Oil
- As of early 2025, 35–40% of India’s crude imports come from Russia—up from less than 1% before February 2022 www.ndtv.com+5mint+5The Financial Express+5.
- Daily Russian crude deliveries to India stood at approximately 1.6–1.7 million barrels per day (bpd), fueling record refining profits amid discounted pricing reddit.com+3Firstpost+3ABP Live+3.
💰 Economic Fallout: Higher Oil Bills and Inflation Risks
Analysts estimate that if India is forced to reduce reliance on Russian crude due to U.S. tariffs or penalties, its annual oil import bill could rise by an additional USD 9–11 billion—fueling inflation and eroding profit margins for refiners The Times of India+2ABP Live+2The Financial Express+2.
A market expert warned that global oil prices could rise to over USD 100/barrel, especially if Indian and Chinese demand for Russian crude falls sharply S&P Global.
🇮🇳 India’s Counter‑Strategy: Diversification and Resilience (Raise Tariffs On India Over Russian Oil)
India’s energy minister, Hardeep Singh Puri, stated New Delhi is not unduly concerned about U.S. tariff threats, citing:
- Diversified supply: India now sources oil from 40 countries, up from 27 in 2007 The Times of India+4www.ndtv.com+4The Economic Times+4.
- Expanded imports from the U.S. (+51% YoY) and Brazil (+80%) during H1 2025, reducing dependence on Russian oil The Times of India.
- Strategic reserves and storage—15 days to 3 months of stockpiling—help ensure continuity in supply even amid disruptions The Times of India.
⚠️ Geopolitical Stakes: U.S.–India Relations at a Crossroad
- Trump’s aggressive trade posture, including threats against India, China, Japan, South Korea, and Australia, is said to be driving parts of Asia closer to China, undermining U.S. diplomatic reach washingtonpost.com.
- Pending legislation like the Sanctioning Russia Act of 2025 (S.1241) proposes 500% tariffs on countries importing Russian energy or defence goods—escalating pressure on India and other major partners unless Moscow negotiates a peace deal soon Firstpost+2en.wikipedia.org+2en.wikipedia.org+2.
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📌 Summary Table
| Topic | Key Points |
|---|---|
| Tariff Announcement | “Substantial” tariffs to follow 25% duty announced on August 4, 2025 |
| India’s Oil Imports | ~35–40% of crude from Russia; imports at 1.6–1.7M bpd |
| Economic Impact | Oil bill could rise US $9–11 billion; potential price hikes globally |
| India Strategy | Diversifying suppliers, boosting U.S. & Brazilian imports, building reserves |
| Geopolitical Risks | Trade damage, closer ties to China, Senate bill proposing 500% tariffs |
Reference link https://www.ndtv.com/world-news/india-buying-massive-amounts-of-russian-oil-selling-it-on-the-open-market-alleges-trump-threatens-to-raise-tariff-9017954