Donald Trump has intensified trade pressure on New Delhi, threatening significantly higher tariffs if India continues importing crude oil from Russia.
Despite US sanctions on Russian energy giants like Rosneft and Lukoil, India remains the largest buyer of Russian crude. While India has doubled its oil imports from the US this year, Washington remains dissatisfied.
Currently, Indian exports face a 50 per cent tariff in the US, with half of that levy attributed to India’s refusal to sever ties with Moscow. The Indian government now faces a critical decision: prioritise energy security or protect its export economy from further American penalties.
Sanctions & Strategic Autonomy
The tension stems from India’s efforts to maintain strategic autonomy while the US seeks to isolate Russia economically. In October, the US imposed fresh sanctions on major Russian oil firms to choke Moscow’s revenue streams.
Initially, Indian refiners like Reliance Industries and state-owned entities considered reducing Russian imports to avoid secondary sanctions. However, commerce ministry data reveals that between April and November 2025, Russia supplied nearly 60 million tonnes of crude to India.
This persistent reliance on Moscow has prompted Trump to warn that he can raise trade barriers “very quickly” if India does not comply with Washington’s demands.
Economic Impact
The economic consequences of this standoff are already visible. According to the Global Trade Research Initiative (GTRI), Indian exports to the US plummeted by 20.7 per cent between May and November 2025.
The GTRI reports that the current “wait and watch” approach is weakening India’s bargaining position. President Trump stated that Prime Minister Narendra Modi is fully aware of the American stance.
Experts suggest that even if India halts Russian oil imports, Washington might shift its pressure toward other sectors like agriculture or digital trade. India must now weigh the cheap cost of Russian oil against the massive loss in export revenue.
Expert Analysis
The GTRI has urged the Indian government to take a “clean call” on its energy policy. The think tank suggests that ambiguity is no longer a viable strategy, as the US administration is increasingly transactional.
While Indian officials have previously defended the oil purchases as a move to keep domestic fuel prices stable and curb inflation, the mounting tariffs are beginning to offset those savings.
Trump’s latest statement underscores that the US views India’s energy choices as a direct challenge to its foreign policy goals. Consequently, the Indian industry is bracing for a potential trade war if a diplomatic middle ground is not found.
Balancing Energy Security
For India, the dilemma is twofold. On one hand, Russian oil is essential for meeting the energy demands of a growing economy at a discounted rate. On the other hand, the United States is one of India’s largest trading partners and a crucial destination for its IT services, textiles, and pharmaceuticals.
If tariffs continue to climb, Indian products will lose their competitive edge in the American market, leading to job losses and reduced industrial growth. Policy experts believe that India needs a transparent roadmap to communicate its energy transition plans to the US to prevent further economic deterioration.
The Logical Indian’s Perspective
At The Logical Indian, we believe that global stability thrives on mutual respect and the peaceful resolution of trade disputes. While every nation must safeguard its economic interests, unilateral threats of high tariffs often undermine the spirit of international cooperation and harmony.
We advocate for a path rooted in empathy and dialogue, where energy security and trade relations are not viewed as a zero-sum game. A stable Indo-US partnership is vital for global prosperity, and both nations should work toward a consensus that respects India’s developmental needs while addressing global security concerns.
