No additional 25% tariffs for India? Has Trump changed his mind after meeting Putin?

For India, the high-profile summit between United States President Donald Trump and Russian President Vladimir Putin in Alaska on Friday, carried additional weight.

New Delhi was hoping for an outcome that could ease or avert the heavy tariffs Washington has tied to its Russian oil purchases.

Trump and Putin held talks in Alaska amid high expectations that the two leaders might announce some form of agreement on Ukraine. Both men presented their discussions in a positive light but stopped short of confirming a breakthrough.

Putin referred to an important “agreement” emerging from the dialogue, while Trump described “considerable progress” but admitted that no final settlement had been reached.

“There are just a very few [sticking points] left,” Trump told reporters. “Some are not that significant. One is probably the most significant — but we have a very good chance of getting there.”

Putin, in turn, highlighted the need to improve bilateral ties with Washington while holding firm to Russia’s central positions on the war.

He reminded his audience that Russia and the United States share a border across the Northern Pacific and evoked the cooperation of the Second World War as a model for the future.

Despite the conciliatory words, the absence of a tangible agreement means the punitive trade measures Trump has tied to Ukraine remain in place.

For India, this directly translates into higher costs and trade friction with its largest export destination.

India caught in the crossfire of US tariffs

In early August, Trump ordered an additional 25 per cent duty on Indian exports to the US, which he subsequently doubled to 50 per cent.

The additional measures, scheduled to take effect on August 27, have been explicitly linked to India’s continued imports of Russian crude oil.

Trump has presented the tariffs as part of a broader strategy to weaken Moscow’s finances and push it toward compromise.

“Well, he [Russian President Vladimir Putin] lost an oil client, so to speak, which is India, which was doing about 40 per cent of the oil. China, as you know, is doing a lot… And if I did what’s called a secondary sanction, or a secondary tariff, it would be very devastating from their standpoint. If I have to do it, I’ll do it. Maybe I won’t have to do it,” Trump said in an interview with Fox News before departing for Alaska.

The move has been condemned by New Delhi as “unfair, unjustified and unreasonable.” Prime Minister Narendra Modi has asserted that India “would not back down in the face of economic pressure.”

Trump also said, “I think everything has an impact,” referring to Russia’s outreach for talks. “When you lose your second largest customer, and you’re probably going to lose your first largest customer, I think that probably has a role.”

He claimed that informing India of new charges on its Russian oil dealings “essentially took them out of buying oil from Russia” and that this helped drive Putin to seek a meeting.

Indian officials, however, have publicly contradicted this assertion, stating that imports from Russia have not been suspended.

Still, the scale of the tariffs makes them among the steepest Washington has ever imposed on a partner country, putting India in the same category as Brazil, which has also been targeted.

Trump connects India tariffs to India-Pakistan ceasefire

Trump has repeatedly cited his role in mediating tensions between India and Pakistan following the Pahalgam terror attack in May. The clashes, which saw both countries claim to have shot down each other’s aircraft, raised fears of a major escalation.

Indian Air Chief Marshal AP Singh later stated that Indian forces had damaged several US-made F-16 jets stationed at Pakistan’s Jacobabad airbase, though details of India’s own losses have not been made public.

“Take a look at India and Pakistan. they were shooting down aeroplanes already, and that would have been maybe nuclear. I would have said it was going to go nuclear, and I was able to get [a ceasefire] done,” Trump said.

He argued that he leveraged US trade ties to press both sides toward de-escalation: “I deal with all of the countries for trade… So if there’s a war going on, and if we’re doing trade with one or both of them, I say we’re not going to do a deal unless you make peace.”

Trump has even suggested that his involvement in multiple conflicts, including the situation between India and Pakistan and the ongoing war in Ukraine, strengthens his claim to recognition such as the Nobel Peace Prize.

Why Russian oil matters to India

India’s reliance on Russian oil grew significantly after Moscow’s invasion of Ukraine in February 2022. As Western nations cut back their imports, Russia began offering steep discounts to secure buyers, and India emerged as one of the largest purchasers.

By 2022, New Delhi had become Russia’s biggest oil customer, surpassing even its long-term suppliers Iraq and Saudi Arabia.

The strategy allowed India to strengthen its energy security and contain domestic fuel inflation. It also enabled Indian refiners to process Russian crude into petroleum products for export, including to European markets.

But Washington has viewed these imports as a crucial source of revenue for Moscow’s war effort, and has increasingly sought to cut them off.

US Treasury Secretary Scott Bessent warned ahead of the Alaska summit that further penalties could follow if no peace deal materialised, and called on Europe to impose parallel sanctions on countries still conducting extensive trade with Russia.

A bill under discussion in US Congress would even give the president authority to levy duties of up to 500 per cent on states considered to be sustaining Moscow’s wartime economy.

India, however, has maintained that its decisions are guided by economic necessity. Officials have clarified that the country has not halted purchases from Russia in response to US threats and continues to procure oil on the basis of cost-effectiveness.

How US’ tariffs may impact India

Indian exports worth nearly USD 40 billion, spanning textiles, marine products, and leather goods, are likely to be affected. Sectors heavily dependent on the US market will be hit hardest, with exporters already warning of potential layoffs and reduced competitiveness.

If India were to reduce or suspend its Russian imports in response to US pressure, the financial strain could be even greater.

A study by the State Bank of India has estimated that India’s crude oil import bill could increase by USD 9 billion this financial year and USD 12 billion in the next without discounted Russian supplies.

Iraq, Saudi Arabia, and the United Arab Emirates are seen as possible alternatives, but their oil typically commands higher prices, leaving India more vulnerable to global price fluctuations.

US restraint towards China

While India has already been targeted with steep tariffs, Trump has so far refrained from taking similar action against China, Russia’s largest oil customer.

The US and China are simultaneously negotiating a potential trade deal aimed at reducing tensions, which could partly explain Washington’s hesitation.

“India doesn’t buy your oil. The European Union won’t buy it. And why in the back of my head was I thinking, wait a minute, Donald Trump just delayed possible a possible increase in tariffs on China? Why do I think that probably President Trump was thinking ahead that maybe if you had to, that would have been part of the consequences?” Fox News asked Trump after the meet.

Trump replied, “Well, because of what happened today, I think I don’t have to think about that now. I may have to think about it in two weeks or three weeks or something, but we don’t have to think about that right now. I think you know, the meeting went very well.”

However, if punitive measures against Beijing are eventually rolled out, China could become the primary focus of US secondary sanctions.

For India, the uneven application of penalties raises questions about whether New Delhi is being disproportionately singled out despite China’s larger role in sustaining Russia’s oil revenues.

The full 50 per cent tariff on India set to take effect on August 27 threatens to undercut its exports to the US market, while its energy partnership with Russia remains under scrutiny.

With inputs from agencies

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