Tariff Relief for India? US Treasury Secretary Scott Bessent Hints ‘There Is a Path’

The United States has hinted that it may reconsider the 25 percent tariffs imposed on India, suggesting a possible change in its trade approach. US Treasury Secretary Scott Bessent said the tariffs were a "huge success" and added that there could now be a way to remove them.

His remarks indicate that Washington believes the tariffs achieved their main goal-reducing India's purchase of Russian oil-and that the situation may be reviewed going forward.

Why the Tariffs Were Imposed

Scott Bessent explained that before the Russia-Ukraine war, Russian oil made up only about 2 to 3 percent of the crude processed by Indian refineries. However, after Western sanctions on Moscow, Russian oil began selling at heavy discounts.

This led Indian refiners to buy more Russian crude, as it helped them lower costs and improve profit margins.

The US saw this shift as a concern, arguing that revenue from Russian oil sales was helping fund the war. To pressure India, Washington imposed a 25 percent tariff, which Bessent now claims led to a sharp drop in India's Russian oil purchases.

Calling the move effective, he said the tariffs succeeded in changing India's buying pattern and suggested there may now be "a path" to removing them.

India, EU Talks and Wider Trade Tensions

Bessent's comments come at a time when India and the European Union are preparing for what has been described as the "mother of all deals." Reports suggest the agreement could be announced as early as January 27, when leaders from both sides are expected to meet at a high-level summit.

This development is taking place amid uncertainty around US trade policies under President Donald Trump. Trump has earlier threatened to widen trade disputes with European allies, especially over their opposition to a US move to take control of Greenland.

The 50 Percent Tariff Burden on India

The US currently imposes a total of 50 percent tariffs on most Indian exports. A 25 percent reciprocal tariff was first announced on April 2, 2025, citing unfair trade practices and India's large trade surplus. Another 25 percent penalty was added on August 6, 2025, through an executive order that directly targeted India's purchase of discounted Russian oil.

President Trump has repeatedly claimed that India's oil purchases indirectly support Russia's war efforts. India, however, has defended its position, saying it has the right to buy oil from the most affordable sources to meet the energy needs of its 1.4 billion people.

Talks Continue, Tone Softens

Several rounds of discussions have taken place between India and the US since the tariffs were imposed, but no final agreement has been reached yet. Despite this, recent statements suggest a softer tone from Washington.

At the World Economic Forum in Davos, Trump said he has "great respect" for Prime Minister Narendra Modi, calling him a "fantastic man" and a friend. He added that he is confident India and the US will eventually reach a trade agreement, even as tariff-related tensions continue.

For now, Bessent's remarks offer a sign that the US may be open to easing trade pressure on India if diplomatic and economic concerns are addressed.