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India faces highest US tariff rate at 50%, but Trump's ‘Russian oil’ reason on slippery ground
Trump due to meet Russia's Putin, and a deal there could trump the rationale for punitive tariffs; China, EU continue to buy Russian oil but are not penalised
India is one of two countries with the highest trade tariff rate imposed on them by US President Donald Trump, the other being Brazil — both facing 50% duties on their exports to the United States.
So far, for India, 25% tariffs have kicked in, while the other 25%, which Trump calls “penalty” for buying Russian oil, kicks in after 21 days of that, on August 28.
Syria follows at 41%, and then come Laos and Myanmar at 40%, rounding off the five at the top of the tariff rate chart compiled by NYT, India being the largest of the five economies.
Also read | Trump threatens India over Russia trade, but what about US, EU? Numbers speak
Despite obvious challenges to Trump's rationale, India has found itself particularly at the centre of his wrath as he says countries buying from Russia are “fueling the war machine” against Ukraine.
Trump is due to meet Russian President Vladimir Putin in a few weeks, though, and the invasion of Ukraine is likely to be the major agenda item.
A deal there could further dent the Russian-oil rationale for punitive tariffs.
Prime Minister Narendra Modi, meanwhile, spoke to Brazil's Luiz Inacio Lula da Silva over the phone on Thursday. They reportedly discussed the tariffs, besides other things.
Lula has been combative against Trump, while India, too, has repeatedly argued that the US move is inconsistent in its reasoning.
European countries import Russian crude too. And China has so far not faced punitive tariffs despite leading the world in energy purchases from Russia. India is second after China in oil imports from Russia.
On China, which is currently on the 10-30% tariff track, US Commerce Secretary Howard Lutnick has said the deadline for a deal being worked upon may be extended by another 90 days.
No such concessions have been granted to India so far, and Trump has now said the trade talks are on a halt until the oil issue gets resolved. Indian and US negotiators were scheduled to meet for a sixth round of talks later this month; that may be in peril too.
What Russia, China say on US attitude towards India
Russia and China, however, have so far sided with or acknowledged the Modi government's position as they seek to counter-balance the US in an increasingly multipolar world.
"Sovereign countries have the right to choose their own trade partners," Russian spokesperson Dmitry Peskov has said.
The Chinese ambassador to India, Xu Feihong, apparently took a shot at Trump in a social media post on Thursday, the day the 25% first round of tariffs on India came into effect. "Give the bully an inch, he will take a mile," Xu Feihong posted on X.
India not alone in buying from Russia
Some analysts believe tariffs are being used as tactic at this stage as even the US trade with Russia has continued despite the Ukraine war that started in 2022.
“Countries such as China, and the European Union, even the the US itself, have been importing Russian oil and other commodities," Shashi Mathews, partner in the taxation firm CMS INDUSLAW, told Financial Express. "It appears that this was more of a tactic… to gain leverage in the ongoing trade negotiations, considering the tariffs kick in 21 days later,” he added.
Russia is the world's third largest global crude oil producer, after the US and Saudi Arabia. India is the world’s third-largest oil consumer.
EU's purchases from Russia have reduced to 2.01% of its oil imports in 2025 from 28.74% in 2021, but the amount stood at 1.48 billion euros in the first quarter of 2025 alone. Russia's share in natural gas in the EU is still 17%, and nearly 8% in iron and steel. More than 25% of EU's fertiliser imports are from Russia.
The US had not imposed punitive tariffs on the EU.
India, which has neutrally called for an end to the Ukraine war at multiple platforms, has justified its increasing imports from Russia, which is its longtime strategic partner too. It has cited availability, price factors and national interest.
US imports from Russia have fallen but since January 2022, the US has still bought nearly $25 billion in Russian goods. Numbers on fertilisers have been steady, as on uranium and plutonium.
Why India buys from Russia
India’s petroleum minister Hardeep Singh Puri had said last month that because price of oil would have gone up significantly, “we were advised, including by our friends in the United States, to please buy Russian oil”.
India was not a big Russian oil buyer until 2021, and mostly depended on West Asia/Middle East. That changed when Russia invaded Ukraine in 2022, and G7 nations put a price cap on Russian oil at $60 per barrel, aiming to curb Moscow’s revenues that it needed for the war. India was allowed to buy under this cap, which made the Russian oil available at discounted prices.
Russian oil is now 37 per cent of India’s total oil imports, according to Kpler, a data analytics firm, making India one of Russian crude’s two top buyers along with China. In the last fiscal year, India saved around $3.8 billion on its purchases on discounted prices from Russia, credit rating agencies have estimated.
