Trump says he will 'substantially' raise tariffs on India over Russia oil purchases

WASHINGTON: United States President Donald Trump said on Monday (Aug 4) he will substantially raise tariffs on India over its purchases of Russian oil, a key source of revenue for Moscow's war on Ukraine.

"India is not only buying massive amounts of Russian oil, 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," Trump said in a post on Truth Social.

"Because of this, I will be substantially raising the Tariff paid by India to the USA."

He did not elaborate on what the tariff would be.

Trump last week said he would impose a 25 per cent tariff on goods imported from India and added that the world's fifth-largest economy would also face an unspecified penalty but gave no details. He also said trade talks with India were ongoing, but had stalled due to “geopolitical disagreements.”

Over the weekend, two Indian government sources told Reuters that India will keep purchasing oil from Russia despite Trump's threats. The sources did not wish to be identified due to the sensitivity of the matter.

On Monday, India formally rejected criticism from the US and European Union, calling it "unjustified and unreasonable" to target the country over Russian oil imports.

"Like any major economy, India will take all necessary measures to safeguard its national interests and economic security," Foreign Ministry spokesperson Randhir Jaiswal said in a statement. He added that India’s oil imports were “a necessity compelled by the global market situation.”

In the statement, India said it began buying Russian oil in large quantities after traditional supply routes were diverted to Europe following the Ukraine conflict. Jaiswal also said that Western nations criticising India continued to trade with Russia, adding that "it is revealing that the very nations criticizing India are themselves indulging in trade with Russia."

Pradeep Taneja, a senior Asian Studies lecturer at the University of Melbourne, said Trump’s lack of concrete details on the additional tariffs implies the White House is still hoping to reach an agreement with New Delhi.

India has also significantly increased recent imports of US crude, with the nation’s largest refiner Indian Oil Corporation (IOC) purchasing at least five million barrels, according to Bloomberg.

“India is trying to signal to Washington that it doesn't just buy oil from Russia,” said Taneja. “It buys oil from diverse sources and is willing to increase imports from the US. So, there is still room for negotiations.”

He added that if a deal is to be struck between India and the US, talks have to be based on a more comprehensive relationship, rather than purely on tariffs and trade.

“With China's aggressive posture in the Indo-Pacific region, India is almost an indispensable security partner to the US,” Taneja told CNA’s Asia Now programme. 

“Officials in India would be hoping that those in the US administration, who understand the security dynamics and the role that India can play, would try and influence Trump to moderate his demands on India.”

Trump has also recently stepped up criticism of India’s role in BRICS, calling the group hostile to US interests. India has rejected that claim, saying the bloc promotes the interests of developing countries.

Indian officials have also expressed frustration over Trump repeatedly claiming credit for an India-Pakistan ceasefire brokered in May. India maintains that it resolves disputes with Islamabad bilaterally.

Trump's heightened pressure on India comes after he signalled fresh sanctions on Moscow if it did not make progress by Friday towards a peace deal with Kyiv, more than three years since Russia's invasion.

Moscow is anticipating talks with the US leader's special envoy Steve Witkoff, who is expected to meet President Vladimir Putin this week.