With a 25% tariff on Indian goods and more penalties under discussion, India now faces its most delicate foreign policy test, managing vital Russian ties while protecting its US trade relationship.
United States President Donald Trump has delivered a double blow to New Delhi, slapping a 25% tariff on Indian exports, effective August 1, and threatening an additional penalty over India’s growing military and energy ties with Russia. Calling out what he labeled India’s “protectionist stance” and “support for Moscow,” Trump’s move marks a new low in India-US relations.
In a series of posts on Truth Social, Trump accused India of being Russia’s “largest energy buyer” and one of its top military customers. He pointed to India’s membership in BRICS, an economic bloc he termed “anti-American”, as a signal that India’s global alignment is shifting away from Washington.
“They can take their dead economies down together, for all I care,” Trump wrote, referring to both India and Russia.
India’s Oil Dependence on Russia: A Strategic Compulsion
India imports about 88% of its crude oil, and over the past two years, Russia has emerged as its top supplier.
• Before the Ukraine war, Russian oil made up just 2% of India’s imports.
• By mid-2025, it surged to over 2 million barrels per day, overtaking all West Asian sources combined.
Foreign Minister S. Jaishankar has defended the purchases as a market-driven necessity, arguing that India cannot afford moral lectures from countries that once bought even more from Russia.
“We are a big oil importer because we don’t have oil. There’s a market strategy to buy oil, not a political one,” Jaishankar said.
Defence Ties with Russia: A Legacy Not Easily Replaced
Russia has been India’s key arms supplier for decades:
• Over 65% of India’s military imports since 2000 — worth over $60 billion — came from Russia.
• Russian systems like S-400 air defence missiles, Sukhoi jets, and T-90 tanks remain crucial.
• Even as India diversifies with the US and France, spares and maintenance for older Russian gear keep New Delhi tied to Moscow.
Trade Surge: From $10 Billion to $68 Billion
India-Russia trade has soared post-pandemic:
• From $10.1 billion pre-COVID, it shot up to $68.7 billion in FY 2024–25.
• Imports of discounted oil, coal, and fertilisers dominate.
• Infrastructure projects like the INSTC trade route and Chennai–Vladivostok maritime corridor are gaining momentum.
India’s Position on Ukraine and the West
India has maintained a neutral and balanced stance on the Russia-Ukraine war, calling for diplomacy, yet refusing to halt energy and defence engagement with Moscow.
While it remains committed to resolving trade issues with the US, India has made it clear that national interest will not be sacrificed.
“We are studying the implications and remain committed to a fair, balanced, and mutually beneficial trade deal,” New Delhi said in response to the tariff move.
What Lies Ahead?
As Washington tightens pressure and the August 1 tariff deadline looms, India is staring at a hard choice:
• Scale down ties with Moscow and risk energy security, or
• Stand firm on its strategic autonomy and face long-term consequences with its largest export market.
With defence, energy, and geopolitical interests entangled, New Delhi’s balancing act has never been tougher.
