Trump Warns of Higher Tariffs on India Over Russian Oil Purchases
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New Delhi is signaling a willingness to adjust its energy purchases and maintain a firm stance in trade negotiations as it seeks to avoid further tariffs from Washington.
US Tariffs and India’s Response
the United States doubled import tariffs on Indian goods to 50 percent in 2023, citing India’s increased purchases of Russian oil as the justification. Despite these substantial tariffs, India’s exports to the US actually increased in November 2023, a surprising outcome that has emboldened Indian officials.
This unexpected surge in exports has allowed India to maintain a relatively firm position in trade discussions with the US.Indian officials are signaling limited flexibility on key demands, notably concerning agricultural imports. Simultaneously, data indicates a decline in India’s reliance on Russian oil.
Shifting Energy Purchases
India is now requesting weekly disclosures from refiners regarding their purchases of both Russian and US oil, according to people familiar with the matter reported by Reuters. this move suggests an expectation that Russian crude imports will fall below 1 million barrels per day as New Delhi attempts to secure a favorable trade agreement with Washington.
This shift in energy sourcing is a key indicator of India’s willingness to address US concerns, but it doesn’t necessarily equate to complete capitulation on other trade issues.
Diplomatic Efforts and Ongoing Dialogue
Prime Minister Narendra Modi has engaged in at least three phone conversations with former President Donald trump as the imposition of the tariffs, but these discussions have not yet yielded a resolution. The outcome of future talks with the current administration remains to be seen.
More recently, India’s Commerce Secretary Rajesh Agrawal met with US Deputy Trade Representative Rick Switzer in Delhi last month to discuss bilateral trade and economic ties. Details of that meeting have not been publicly released, but it represents a continued effort to find common ground.