Trump Imposes Additional 25% Tariff on Indian Goods Over Russian Oil Imports; India Calls Move ‘Unfair and Unjustified’

Washington/New Delhi: In a dramatic escalation of trade tensions, former US President Donald Trump announced a fresh 25 per cent tariff on Indian goods Wednesday night, calling it a “penalty” for India’s continued import of crude oil from Russia. The move, which takes total US import duties on Indian goods to a staggering 50 per cent, has drawn sharp condemnation from New Delhi.

The new tariffs—set to come into effect within 21 days—are part of Trump’s broader strategy to punish countries he claims are indirectly funding Russia’s war effort in Ukraine by purchasing its oil and natural resources.

In an executive order signed earlier today, Trump stated: “I find the Government of India is currently, directly or indirectly, importing Russian Federation oil… in my judgement I determine it necessary to impose an ad valorem duty on imports of articles from India.”

India’s reaction was swift and unequivocal. A government spokesperson described the move as “unfair, unjustified, and unreasonable,” pointing out that India’s oil imports are driven by market conditions and aimed at securing affordable energy for its population of 1.4 billion.

“It is extremely unfortunate that the US has chosen to impose additional tariffs on India for actions that several other countries are also undertaking in their own national interest,” the statement said.

The announcement came just hours after Trump made combative remarks on US-India trade relations during a televised interview. “India has not been a good trading partner… I think I’m going to raise that (tariff) substantially because they’re buying Russian oil,” Trump said.

Trump’s tariff decision appears to be part of a broader geopolitical pivot. While India faces penalty duties, Pakistan has received a tariff reduction to 19 per cent and a new trade deal, including plans to help develop its domestic oil reserves. Analysts view this as a signal of shifting alliances that could draw India closer to Russia and other BRICS nations.

India also pointed out the hypocrisy in the US stance, citing data that shows several western countries, including EU members and the US itself, continue to import Russian goods. “Unlike others, our purchases are a necessity compelled by the global market situation,” the government said, noting that the EU bought €67.5 billion worth of LNG from Russia in 2024.

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The ongoing India-US trade negotiations—initiated under President Biden in December—are now under renewed strain. Talks had stalled due to India’s refusal to open up its agriculture market to US farm products, with Trump labelling India a “very big tariff abuser.”

While Indian officials have downplayed the economic impact of the initial 25 per cent tariff, estimating GDP losses of only 0.2 to 0.3 per cent, experts warn that the additional “penalty” could have more far-reaching consequences, especially in sectors heavily reliant on exports to the US.

With diplomatic and trade relations already on shaky ground, Trump’s tariff strike threatens to widen the rift between two major democracies and could reconfigure global trade alliances in the months to come. [KNT]