US President Donald Trump has imposed an additional 25% tariff on Indian imports over India’s continued purchase of Russian oil, raising the total tariff to 50%. India strongly criticized the move as “unfair” and defended its reliance on Russian oil as essential for national energy security. The tariffs jeopardize nearly 55% of Indian exports to the US—its largest export destination—affecting key sectors such as textiles, footwear, and gems and jewellery. Analysts see this as the most serious deterioration in US – India relations since Trump’s return to office in January.
US President Donald Trump on August 6, 2025, signed an executive order imposing an additional 25% tariff on Indian imports, citing New Delhi’s continued purchase of Russian oil — either “directly or indirectly.” This comes on top of a previous 25% tariff announced on July 31. While the initial tariff takes effect from August 7, the second 25% levy will be enforced 21 days later.
President Trump’s executive order stated, “To deal with the national emergency described in Executive Order 14066 [relating to Russia’s actions in Ukraine], I determine that it is necessary and appropriate to impose an additional ad valorem duty on imports of articles of India, which is directly or indirectly importing Russian Federation oil. Accordingly, and as consistent with applicable law, articles of India imported into the customs territory of the United States shall be subject to an additional ad valorem rate of duty of 25%.”
As per the order, ‘Goods already in transit by 12:01 a.m. EDT, 21 days after August 6, and arriving before September 17, 2025, are exempt from the additional duty.’
India’s Ministry of External Affairs (MEA) responded strongly, calling the move “unfair, unjustified, and unreasonable.” It reiterated that the US had earlier supported India’s decision to diversify energy sources and even encouraged purchases from Russia. Moreover, the MEA pointed out that both the US and European Union continue to trade with Russia in volumes that far exceed India’s oil-related transactions.
The MEA statement said, “We have already made clear our position on these issues, including the fact that our imports are based on market factors and done with the overall objective of ensuring the energy security of 1.4 billion people of India. It is therefore extremely unfortunate that the US should choose to impose additional tariff on India for actions that several other countries are also taking in their own national interest.”
The MEA added, “India will take all actions necessary to protect its national interests.”
Over the last few days, President Trump had repeatedly warned of additional tariffs as a “penalty” for India’s Russian oil imports.
Analysts say this latest escalation marks a serious blow to India’s trade interests, particularly its exports to the US Nearly 55% of Indian exports to the American market are likely to be directly impacted, they said. The cumulative 50% tariff would place Indian exporters at a significant disadvantage — with a cost burden that makes them 30% to 35% less competitive compared to counterparts from countries with more favourable trade terms.
India is the 12th-largest trading partner of the United States, with goods worth US$ 78.4 billion exchanged between January and June 2025, according to US federal data.
India also maintains an informal economic partnership with Russia through its membership in the BRICS group, which also comprises Brazil, China, and South Africa. (Oil and gas are Russia’s primary exports, with China, India, and Turkey among its largest buyers.)
Trump’s hardline stance on Russian oil has placed New Delhi in a difficult position. Since 2023, India has been the leading importer of Russian crude, bringing in 89 million tons last year, according to shipping data firm Kpler. Russian crude represents 38% of India’s total oil imports, the data indicates. India also sources 36% of its military arms imports from Russia, according to the Stockholm International Peace Research Institute. This marks a significant decline from the 72% share recorded between 2010 and 2014. Notably, Trump’s executive order imposing the additional tariff made no mention of China, even though it also imports Russian oil. However, he later indicated that similar tariffs on Chinese goods could be announced soon.
The BRICS nations have been at the center of some of Trump’s most challenging tariff negotiations. Although the White House has announced preliminary trade deal frameworks with nearly a dozen of America’s major trading partners, it has yet to reach a formal agreement with China, opting instead for a temporary truce as talks continue. In Brazil’s case, Trump imposed a 50% tariff in response to the country’s anti-corruption probe involving former President Jair Bolsonaro.
What are analysts saying?
President Trump has repeatedly maintained that trade tariffs are essential for improving the US’s strained financial health and for correcting trade imbalances with countries he believes are taking unfair advantage of America. Lately, he has also leveraged tariffs as a foreign policy instrument, using the threat of increased trade restrictions to push Thailand and Cambodia toward resolving their border conflicts.
According to analysts, Trump’s decision signals the most significant downturn in US – India relations since his return to office in January. The new tariffs threaten to severely impact India’s access to its largest export destination, where exports totaled nearly US$ 87 billion in 2024, particularly affecting industries like textiles, footwear, and gems and jewellery. This escalation also marks a stark departure from the cordial tone seen during the Trump-Modi meeting in February.
Analysts also point to Trump’s recent remarks as evidence of a growing rift—he has described India’s economy as “dead,” criticized its trade barriers as “obnoxious,” and accused the country of reaping the benefits of discounted Russian oil while ignoring the human toll of Russia’s ongoing three-and-a-half-year war in Ukraine.
The latest developments come as Indian Prime Minister Narendra Modi prepares for his first visit to China in over seven years—a move seen by many as signaling a possible shift in strategic alignments amid souring ties with the United States.
Trade experts suggest that India should not retaliate immediately and instead adopt a patient, calculated approach. Any decision to reduce or stop India’s Russian oil imports, they argue, must be based on economic viability — not geopolitical pressure. They emphasized that constructive trade negotiations cannot take place amid threats and should instead be grounded in mutual respect and trust.
Despite tensions, negotiations for a Bilateral Trade Agreement (BTA) between the two nations are ongoing, with the next round of talks scheduled to begin on August 25 in New Delhi. The government is also considering support measures for exporters, such as interest subsidies and loan guarantee schemes.
