In the latest development of trade conflicts, President Donald Trump of the United States has imposed tariffs of 50% on Indian exports, effective August 27th.
The tariffs focus on India’s purchase of 1.75 million barrels of Russian oil per day, which accounts for 35-42% of its oil imports.
This action is said to be a result of an executive order issued due to the impulsive Russian invasion of Ukraine and is an attempt to reduce the funds being sent to Russia for its warfare activities.
India, a key ally of the United States, is now facing an economic burden that includes a projected drop in exports of up to $34-43 billion, which is detrimental to the textile and gem industries.
The implementation of these tariffs, which marks one of the highest levels of tariffs in the world, signals an attempt at a new geopolitical strategy that poses new challenges to the relationship between India and the United States, as well as international trade relations.
Why Is Trump Penalising India for Buying Russian Oil?
Geopolitical Strategy to Isolate Russia: The Trump administration considers India’s significant purchases of Russian oil as a form of economic aid to Russia and Ukraine’s military activities. Trump’s executive order on August 6, 2025, claims that India’s reselling of oil at a markup provides Russia’s aggression with fuel as a direct consequence, which is why an additional 25% tariff is imposed on top of an already established 25% tariff to incentivise India to stop these purchases.
With an Indian oil import volume of 1.75 million barrels per day, India is an easy target.
Trade Imbalance and Economic Leverage: Imbalance of Trade and Strain of Economic Power: For years, Trump has called out India for its steep trade barriers, including the 100 percent duties placed on U.S. goods such as Harley Davidson motorcycles, as well as the $45.8 billion trade surplus India enjoys with the U.S. in 2024. These tariffs are intended to correct the imbalance, and the purchases of oil from Russia provide a convenient justification for increasing the economic burden.
With the $87 billion in exports that India has to the U.S., including labour-intensive goods such as textiles and jewellery, the Trump administration hopes to obtain compliance in trade talks, which have been stalled due to the U.S.’s desire for greater access to the Indian agricultural sector.
Political Communications and Domestic Strategy: Within the U.S., Trump’s tariffs coincide with his “America First” policy, and they resonate with voters by siding against nations considered adversarial, like Russia.
In addition, the tariffs support what has come to be regarded as Trump’s unique approach to foreign policy, characterised by a style that emphasises economic sanctions as a means of demanding compliance on critical matters, such as energy and trade.
Why Is India Being Targeted Specifically?
Selective Punishment Despite Broader Russian Oil Trade: India is the second-largest buyer of Russian oil after China, yet faces harsher penalties (50% tariffs compared to China’s 30% or Turkey’s lower rates). This selective targeting puzzles Indian officials, given that China, the top buyer, received a 90-day tariff truce, and Turkey faces no additional levies.
The focus on India may stem from its strategic importance as a U.S. ally, making it a more feasible target for pressure compared to China, which has a more adversarial relationship with the U.S., or Turkey, with less economic leverage.
Perceived Vulnerability and Strategic Importance: India’s $87 billion in U.S. exports, including textiles, gems, and jewellery, makes it vulnerable to tariffs, giving the U.S. leverage to push for policy changes. The administration may see India as more likely to yield than China due to its economic reliance on U.S. markets.
Unlike China, India’s role as a counterweight to China in the Indo-Pacific makes its targeting surprising, as it risks pushing India toward closer ties with Russia and China, as evidenced by Prime Minister Modi’s planned visit to China in August 2025.
What About Other Countries?
China: The largest purchaser of Russian oil, has not been hit with the same punitive tariffs, a move that Trump had threatened as secondary sanctions on countries buying Russian oil. On August 16, Trump stated that he didn’t need to impose tariffs on China after meeting with Vladimir Putin, indicating a softer stance.
The absence of tariffs on China, simply put, has to do with fear that global oil prices would spike if China’s imports were to be disrupted, U.S. Senator Marco Rubio has pointed out.
Turkey: Another significant buyer of Russian oil, has not faced additional tariffs, despite being among Russia’s top clients. The Trump administration’s focus on India over Turkey may reflect India’s larger export volume to the U.S., making it a more impactful target.
The lack of action against Turkey suggests selective enforcement, possibly due to Turkey’s NATO membership or lower economic leverage compared to India.
Other Countries and Inconsistencies: India’s Ministry of External Affairs has highlighted that the U.S. and European countries continue to trade with Russia ($3.5 billion in U.S.-Russia trade in 2024), including fertilisers and other goods, without facing similar criticism. India argues its oil imports are a necessity driven by market conditions, unlike Western trade, which is less critical.
Trump’s executive order leaves open the possibility of future tariffs on other countries, with the U.S. Commerce and State Departments tasked with assessing Russian oil imports globally. However, as of today, no specific actions against others have been announced.
