US President Donald Trump has once again put pressure on Prime Minister Narendra Modi over India’s purchase of Russian oil, warning that the United States may raise tariffs even further on Indian imports if New Delhi does not curb energy trade with Moscow.

Trump described Modi as “not that happy” with him because of existing tariffs now at a steep 50 per cent which include a *25 per cent levy linked specifically to Russian oil purchases.

Trump’s comments come as India’s Russian oil imports are now expected to fall sharply, with Reliance Industries reporting no Russian crude deliveries in January 2026, amid Washington’s ongoing trade and diplomatic pressure. The dispute has triggered concerns in both capitals, drawn reactions from lawmakers such as Republican Senator Lindsey Graham and strained dialogue on a possible India–US trade agreement.

Tariff Tensions Hit Oil Trade

US–India trade relations have entered one of their tensest phases in recent years as President Trump publicly reiterated threats to raise duties on Indian imports due to New Delhi’s continued purchases of Russian crude.

Speaking to reporters and lawmakers, Trump said he maintained a “very good relationship” with PM Modi but acknowledged the diplomatic strain caused by the high tariffs. He stated that Modi “knew I was not happy” with the situation and hinted that America could “revise tariffs very quickly” if India did not accede to US demands to cut energy ties with Russia.

Tariffs on Indian goods have already been doubled to 50 per cent among the highest levies imposed on any trading partner after Trump linked additional duties directly to India’s oil purchases from Russia.

This emerged initially when the extra 25 per cent penalty was implemented in August 2025, adding to a prior 25 per cent tariff due to longstanding trade and market access differences.

Meanwhile, the economic indicators on Russian crude imports show a marked change: Reliance Industries, India’s largest buyer of Russian oil, has not received any deliveries for weeks and does not anticipate any in January 2026, potentially reducing Indian imports to their lowest level in years.

India’s state refiners such as Indian Oil Corporation, Bharat Petroleum and Nayara Energy may still receive limited deliveries, but the overall trend points downward amid growing Western pressure and sanctions.

US Senator Lindsey Graham, a Trump ally, backed the tariff threat as a means to influence India’s behaviour, suggesting that the punitive measures have “pushed India to cut Russian oil imports.”

According to Graham, India even made a plea for tariff relief through discussions involving Indian Ambassador Vinay Mohan Kwatra though India has not publicly confirmed this.

Wider Trade Dispute and Diplomatic Ripples

The tariff controversy is part of a broader diplomatic and trade crisis between the two democracies that began escalating sharply in mid-2025. Trump’s administration first imposed a reciprocal 25 per cent tariff on Indian exports and later added another 25 per cent “penalty tariff” tied explicitly to Russian energy trade, bringing the total duty on many Indian goods entering the US to 50 per cent.

India has criticised these measures as “unfair, unjustified and unreasonable”, insisting that its energy needs and geopolitical realities drive its oil import decisions.

Beyond energy, tensions have spilled into other sectors. India has been requiring oil refiners to report weekly data on both Russian and US crude imports in an attempt to manage information flow and deepen transparency amid trade negotiations.

The Indian move aims to provide accurate data for policymakers at home while countering reliance on secondary reporting by foreign governments.

Economic analysts note that the tariff on Indian goods valued at tens of billions of dollars annually has significant ramifications. Sectors such as textiles, gems and jewellery, footwear, and furniture are particularly exposed, with some estimates projecting substantial reductions in shipments to the US if tariffs remain at current levels.

Critics in the US have also pointed out that these trade barriers could adversely affect American consumers and firms reliant on Indian imports potentially leading to inflationary pressures and supply chain challenges.

Adding complexity, the US has not applied similar tariff pressures on other large Russian oil buyers like China, a discrepancy that has drawn scrutiny and criticism from analysts who argue that India is being singled out despite similar energy trade behaviours.

American officials, including Treasury and trade representatives, have offered varying justifications for the policy differences, sometimes citing national security considerations and geopolitical alliances.

Energy Strategy Amid Trade Tensions

India’s fuel demand reached record highs in late 2025, underscoring its growing energy needs amid global economic recovery and rising mobility.

In December 2025 alone, India’s fuel consumption climbed to 21.75 million metric tons, reflecting broader demand that complicates New Delhi’s diplomatic balancing act between securing affordable energy supplies and managing international pressure over Russia.

The dramatic decline in Russian deliveries to India has been partly shaped by Western sanctions and secondary restrictions on shipping and financing tied to Russian energy, alongside US tariff threats.

Analysts believe India may increasingly turn to other sources including the United States and Middle Eastern markets while negotiating the complex architecture of international trade agreements.

Trade experts suggest that future negotiations between India and the US could hinge on whether tariffs are rolled back in exchange for clearer commitments on energy imports and market access.

Some advocacy groups in India propose a three-point strategy: end purchases from sanctioned Russian firms, secure a rollback of the punitive tariff component, and pursue a balanced trade agreement with the United States that ensures equitable market access for key Indian sectors. Such an approach could pave the way for resumed comprehensive trade talks and a more predictable bilateral economic relationship.

Despite the tension, Indian officials have largely refrained from public escalation, emphasising that energy decisions are based on national interests and market dynamics. They also stress India’s broader cooperation with the United States on defence, technology and climate goals areas where mutual strategic interests remain significant.

The Logical Indian’s Perspective

The unfolding tariff dispute between the United States and India over Russian oil imports underscores how trade policy can become entangled with geopolitics, sometimes at the expense of constructive collaboration. While global peace and the resolution of the Russia–Ukraine conflict are shared international goals, applying punitive economic measures that strain strategic partnerships may not always yield the desired diplomatic outcomes.

India’s energy choices reflect a complex interplay of affordability, security, and supply diversification, shaped by market realities and national priorities. Likewise, US concerns about the impact of Russian oil revenues on the Ukraine war are legitimate from Washington’s perspective.