US Warns India of Higher Secondary Tariffs For Purchasing Russian Oil

The US has warned India that it could face increased secondary tariffs if discussions between US President Donald Trump and Russian President Vladimir Putin in Alaska on Friday fail to yield positive results.

Currently, India faces a combined 50% tariff on its exports to the U.S., consisting of a 25% baseline tariff and an additional 25% levy on its crude oil trade with Russia. Analysts suggest the extra 25% tariff is a pressure tactic aimed at persuading Putin to end the Russia-Ukraine war.

India and China are the world's top buyers of Russian crude oil. US Treasury Secretary Scott Bessent, in a Bloomberg TV interview, stated, "We put secondary tariffs on the Indians for buying Russian oil. And I could see if things don't go well, then sanctions or secondary tariffs could go up." He added that sanctions on Russia could be tightened or eased based on the outcome of Friday's meeting between Trump and Putin.

India, the third-largest global oil consumer, has significantly boosted its Russian crude purchases since the Ukraine war began, attracted by heavy discounts. However, Trump's move to double tariffs on Indian imports-meant to penalize India's continued Russian oil trade-threatens to strain the country's refining sector. Trump has urged India to stop buying discounted Russian oil, claiming it is "fueling the war machine" in Ukraine.

The additional 25% tariff on India's Russian oil imports is scheduled to take effect on August 27. Experts note that the 21-day gap leaves room for potential India-U.S. negotiations. Before 2022, India relied mostly on Middle Eastern oil, with minimal imports from Russia. However, the Ukraine conflict and the G7's $60-per-barrel price cap-designed to curb Russian revenue while maintaining global supply-shifted India's import patterns.

India has strongly criticized the U.S. tariffs. In a post-announcement statement, the Ministry of External Affairs said, "The United States has in recent days targeted India's oil imports from Russia. 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 further added, "It is therefore extremely unfortunate that the US should choose to impose additional tariffs on India for actions that several other countries are also taking in their own national interest. We reiterate that these actions are unfair, unjustified and unreasonable. India will take all actions necessary to protect its national interests."