Trump vows higher tariffs, India responds

“India is not only buying massive amounts of Russian oil, they are then, for much of the oil purchased, selling it on the open market for big profits," Trump posted on his social media platform Truth Social. “They don’t care how many people in Ukraine are being killed by the Russian war machine. Because of this, I will be substantially raising the tariff paid by India to the USA," Trump said.

In response, New Delhi said the targeting of India was “unjustified and unreasonable." Like any major economy, India would take all necessary measures to safeguard its national interests and economic security, the external affairs ministry said in a statement.

“The United States itself continues to import uranium hexafluoride for its nuclear sector, palladium for EVs, fertilizers and chemicals from Russia," the ministry said.

The statement noted that India’s Russian oil purchases were driven by a need to secure affordable and reliable energy after traditional suppliers shifted exports to Europe at the start of the Ukraine conflict. “At the time, the US had actively encouraged India’s oil imports from Russia to help stabilize global markets," it added.

India’s energy imports are aimed at ensuring price stability for domestic consumers, the ministry said, contrasting this with continuing trade between Russia and its critics. “Unlike India, such trade is not a national compulsion for them," it said. The European Union, it said, recorded €67.5 billion worth of goods trade with Russia in 2024, while services trade stood at €17.2 billion in 2023. Europe’s LNG imports from Russia also hit a record 16.5 million tonnes in 2024, surpassing the previous peak of 15.21 million tonnes in 2022. EU-Russia trade also spans fertilizers, mining goods, chemicals, metals and machinery.

Trump's outburst came against the backdrop of trade talks between the two countries, which have slowed over allowing US firms access to India's dairy and agriculture markets. New Delhi is engaged with the US through talks on the bilateral trade agreement (BTA), an Indian government official said on the condition of anonymity. As per the present understanding between both sides, the next round of talk will begin on 25 August.

A trade analyst dismissed Trump’s statement as misleading. “India does not export crude oil, Russian or otherwise. It is a net importer," said Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI), a think tank. He added that India only exports refined fuels like diesel and jet fuel after processing crude, as do many other countries.

India’s oil imports from Russia have also declined recently. In May 2025, purchases fell 9.8% to $9.2 billion compared to a year ago, official data shows.

“China, not India, is the largest buyer of Russian oil. In 2024, China imported $62.6 billion worth of Russian oil, compared to India’s $52.7 billion. Yet Trump has chosen not to criticize China, possibly due to geopolitical considerations, and has instead unfairly targeted India," Srivastava said.

“India’s oil refineries—comprising both state-run and private-sector companies—operate independently when sourcing crude oil. They do not require government approval to buy from Russia or any other country. These decisions are driven by commercial factors such as pricing, supply security, and export market regulations," he added.

In FY24, India exported about $70.1 billion worth of refined petroleum products globally. Europe emerged as the largest regional destination, with exports to the continent valued at $18.4 billion, according to data from the Ministry of Commerce.

The Netherlands alone accounted for about $10.9 billion, representing nearly 25% of India’s total petroleum product exports during this period—the highest share among European countries—highlighting its role as a key transit hub for Indian refined fuel entering the EU market.

This trend has triggered concerns among Western nations that India’s trade route could be serving as a backdoor for Russian oil entering the European market.

In FY 2025, the value of India's crude oil imports from Russia stood at about $50.3 billion, making it the largest supplier of crude to India, surpassing traditional sources like Iraq and Saudi Arabia.

India imported around 1.75 million barrels per day (bpd) of Russian oil between January and June 2025, making it the top supplier in that period.

Mint reported on 2 August that India will continue to buy oil from Russia, notwithstanding the penal threat and public criticism from the US earlier this week. In fact, India is even reaping a bigger discount on these purchases.

State-owned refiners—Indian Oil Corp. Ltd (IOC), Bharat Petroleum Corp. Ltd (BPCL), and Hindustan Petroleum Corp. Ltd (HPCL)—are continuing to procure oil from Russian suppliers. Negotiations are also underway for fresh spot deals, as reported by Mint.

The last two or three cargoes have been booked at a discount of up to $3 a barrel, compared to about $1.7 in the earlier purchases, and it is likely to rise further, even if not significantly, after US President Donald Trump's censure of India for its Russian energy purchases, Mint reported. The discounts on Russian oil have narrowed down to single-digit from the high of around $30 per barrel in 2022.

India's state-run oil marketers are also in joint discussions with US firms to secure cooking gas supplies starting next year, signalling a potential deepening of energy ties. The companies are exploring long-term arrangements with American exporters.

India traditionally imports most of its LPG from West Asian countries including Qatar, the UAE and Saudi Arabia through long-term contracts, while other major LPG importing countries source it from the US. The US so far has been supplying India LPG in small volumes through spot deals, and this is the first time the Indian companies may have a term deal with US suppliers. On the other hand, China has been a major buyer of LPG from the US.

In India, LPG is used primarily for residential cooking, followed by commercial and industrial purposes. India imported LPG worth $12.47 billion in FY25, 19.85% higher than $10.42 billion the previous year. According to Ken Research, as of December 2024, the Indian LPG market was valued at $15 billion, with growth backed by the government's emphasis on use of LPG for cooking purposes through the Pradhan Mantri Ujjwala Yojana.

As per a 31 July Goldman Sachs research report, Middle East accounts for a largest share of India’s crude oil imports, but after 2022, Russian supply has sharply went up to reach about a third of India’s crude oil imports in 2025, whereas US accounts for about 4% of India’s crude oil supply. The increase in Russian oil supply happened after the Russia-Ukraine war’s commencement.