In a fresh blow to U.S.-India trade relations, U.S. President Donald Trump on Monday, August 4, 2025, launched another scathing attack on India, accusing it of profiteering from Russian oil amid the Ukraine conflict.
The remarks come less than a week after Trump signed an executive order imposing a 25% tariff on all Indian imports, with the threat of additional “penalties.”
In a post on his platform, Truth Social, President Trump alleged India is not only buying massive amounts of Russian oil, but they are then, for much of the oil purchased, selling it on the open market for big profits.
They don’t care how many people in Ukraine are being killed by the Russian war machine. Because of this, I will be substantially raising the tariff paid by India to the USA.”
However, trade experts and officials have been quick to point out that tariffs are paid not by foreign governments but by importers within the U.S., meaning these duties could raise costs for American businesses and consumers, potentially fuelling inflation and disrupting global supply chains.
Trump’s Tariff Offensive: The Backdrop
Trump’s aggressive stance follows his July 31 executive order implementing a 25% tariff on Indian imports, which he justified by criticizing India’s “strenuous and obnoxious non-monetary trade barriers” and its “high tariffs”, calling them among the most protectionist in the world.
He further cited India’s military and energy ties with Russia, including long-standing defense procurements and increased oil imports, as sources of strategic concern.
The tariffs are set to come into effect from August 7, 2025, and have placed India at a disadvantage in comparison with other U.S. trade partners such as Vietnam, Mexico, Indonesia, and the Philippines, who currently face lower or no comparable duties on exports to the United States.
India Pushes Back: “Unjustified and Unreasonable Targeting”
The Government of India has strongly condemned the remarks and measures, calling the U.S. targeting of its trade with Russia “selective and hypocritical”.
In a statement issued by the Ministry of External Affairs (MEA) on August 4, India accused the U.S. and European countries of double standards in their dealings with Russia. India began importing from Russia because traditional energy suppliers redirected their exports to Europe after the Ukraine conflict began,” the MEA spokesperson said.
“At that time, the U.S. actively encouraged India to buy Russian oil to maintain global market stability.”
India emphasized that it has never violated international sanctions, and all trade with Russia has been conducted within legal frameworks under sovereign economic policy decisions.
The MEA also cited recent trade data to counter the narrative:
- In 2024, the European Union’s bilateral goods trade with Russia was €67.5 billion, with services trade touching €17.2 billion in 2023.
- The EU’s LNG imports from Russia hit a record 16.5 million tonnes in 2024, surpassing the previous peak in 2022.
- The EU continues to import fertilisers, chemicals, machinery, steel, and mining products from Russia.
- The United States, too, maintains critical imports from Russia, including:
- Uranium hexafluoride for its nuclear energy sector
- Palladium for electric vehicles
- Chemicals and fertilizers for agriculture this context, the targeting of India is unjustified and unreasonable,” the MEA concluded. “India will take all necessary steps to protect its economic security and national interest.”
Government Strategy: Wait and Watch—For Now
Union Commerce and Industry Minister Piyush Goyal addressed both Houses of Parliament following Trump’s announcement, stating that the government is “studying the implications” of the new tariff regime and consulting all stakeholders, including exporters, industry bodies, and strategic advisors.
He assured lawmakers that “India will respond appropriately” to safeguard its export sectors and strategic autonomy.
According to senior officials in the Ministry of Finance and Commerce, India may consider reciprocal measures, including:
- Raising tariffs on certain American goods
- Diversifying export markets away from the U.S.
- Challenging the tariff hike at the WTO, if necessary
India’s top exports to the U.S. include pharmaceuticals, textiles, engineering goods, and IT services, which could now face greater scrutiny and disruption due to increased cost pressures on U.S. buyers.
Strategic and Economic Fallout
This latest confrontation comes at a time when the U.S.-India strategic partnership had seen years of upward momentum, particularly in areas like defense cooperation, digital technology, and supply chain diversification.
However, the new tariffs and Trump’s aggressive rhetoric may erode that progress, at least temporarily.
Geopolitically, Trump’s remarks reflect a broader attempt to enforce stricter energy discipline among U.S. allies and partners amid ongoing tensions with Russia and China. But analysts warn that India’s independent foreign policy—rooted in strategic autonomy—makes it unlikely to cave in to unilateral pressure.
India has repeatedly made it clear that it rejects bloc politics, and its energy policy is guided by price, availability, and national interest, not by ideological alignment.
Looking Ahead
With the new U.S. tariffs coming into force on August 7 and more penalties being threatened, India is entering a critical phase in its trade diplomacy. Whether Trump’s actions are part of a broader election-year strategy to appeal to protectionist voters or a calculated move to reset trade priorities remains unclear.
However, the global implications of these tensions—on markets, prices, and geopolitical alignment—could be far-reaching.
India, meanwhile, appears determined to stand its ground, defend its right to pursue energy security, and maintain strategic autonomy, even in the face of growing international scrutiny.
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