US May Not Impose Secondary Tariffs on India for Russian Oil Purchases
US President Donald Trump has indicated that his administration may not impose secondary tariffs on countries, including India, for purchasing Russian crude oil. The statement, made after his meeting with Vladimir Putin, signals potential relief for India, which faces existing US tariffs of 50% set to take effect on August 27. The development could significantly impact India's economic and energy security strategy, easing trade tensions between New Delhi and Washington over India's continued procurement of Russian energy resources.
Unpacked:
Secondary tariffs are additional import duties applied to countries trading with a sanctioned nation. The US threatened these on India to pressure it to reduce purchases of Russian oil, aiming to weaken Russia’s economy amid the Ukraine conflict and signal consequences for countries bypassing US-led sanctions.
India has condemned the US tariffs as "unfair, unjustified and unreasonable," asserting that its Russian oil imports are based on market factors and energy security needs. The Indian government has stated it will take all necessary actions to protect its national interests and has criticized being singled out compared to other countries.
Sectors expected to be hit hardest include textiles, marine products, and leather exports, as these are significant Indian exports to the US and are now subject to the highest tariff rates of up to 50%. This could result in reduced competitiveness and potential job losses in these industries.
Analysts suggest the US is targeting India due to frustrations with broader US-India trade disagreements and slow progress in trade talks, rather than solely because of Russian oil. China, despite being the largest buyer, has not faced similar tariffs, likely due to different strategic priorities and complexities in US-China relations.