Tariff relief likely: Trump signals India may avoid secondary sanctions on Russian oil

THEBUSINESSBYTES BUREAU

NEW DELHI, AUGUST 16, 2025

The United States may refrain from imposing secondary tariffs on India for continuing to purchase Russian crude oil, with President Donald Trump indicating that Moscow has already lost a significant client in New Delhi.

Speaking to Fox News aboard Air Force One en route to Alaska, Trump said the US may not move forward with the proposed 25 per cent secondary tariffs on countries still importing Russian oil. “Well, he (Vladimir Putin) lost an oil client, so to speak, which is India, which was doing about 40 per cent of the oil. China, as you know, is doing a lot,” Trump said. “And if I did what’s called a secondary sanction, or a secondary tariff, it would be very devastating from their standpoint. If I have to do it, I’ll do it. Maybe I won’t have to do it,” he added.

The additional tariffs, originally scheduled to take effect from August 27, have been the subject of intense speculation, particularly after US Treasury Secretary Scott Bessent suggested earlier this week that if Trump’s upcoming summit with Russian President Vladimir Putin in Alaska failed to yield positive outcomes, the secondary sanctions on India could be even higher.

New Delhi has firmly opposed the threat of punitive action, calling it unjustified and unreasonable. A government spokesperson stated, “Like any major economy, India will take all necessary measures to safeguard its national interests and economic security.” Officials have also pointed out that India has significantly increased its purchases of oil and gas from the United States, a move that directly contributes to narrowing the trade deficit — a key priority of the Trump administration’s trade policy.

According to official data, India’s oil and gas imports from the US surged by 51 per cent between January and June this year. Liquefied natural gas (LNG) imports nearly doubled to $2.46 billion in 2024-25 from $1.41 billion in the previous fiscal. Earlier this year, Prime Minister Narendra Modi assured that India would boost its energy imports from the US to $25 billion in 2025, up from $15 billion in 2024, aligning with Washington’s economic interests.

In line with this commitment, Indian state-owned oil and gas companies have already initiated talks for additional long-term supply agreements with American firms. At the same time, New Delhi has emphasized its broader strategy of diversifying energy sources to gradually reduce dependence on Russian crude.

While the tariff threat has raised concerns, both governments have reiterated that the India-US partnership extends well beyond trade. Strategic, economic, and security cooperation continues to form the bedrock of bilateral relations, underscoring the resilience of the ties between the two democracies even amid global geopolitical tensions.