On Wednesday, Donald Trump had announced plans to impose a 25 per cent tariff on India, along with an additional penalty, citing concerns over the country’s energy and defence ties with Russia, as well as existing trade barriers.
However, the executive order he signed thereafter only gives effect to the 25 per cent tariff on Indian goods coming to the US. Even this has an exclusion list that includes finished pharmaceutical products (tablets, injectables and syrups), active pharmaceutical ingredients, electronics and ICT goods (semiconductors, smartphones, SSDs and computers), and petroleum products (crude oil, LNG, refined fuels, electricity and coal).
The executive order also does not indicate any penalty that is to be levied for Russian trade.
According to official data, India exported 4.86 million tonnes of petroleum products to the US in fiscal year 2024-25 (April 2024 to March 2025) for over USD 4 billion.
Reliance Industries Ltd is the biggest exporter of fuel to the US.With fuel exports continuing to be on the exemption list, it means business as usual for India and companies like Reliance, analysts said.Also, a relief would be if no penalty is imposed to punish India for its oil imports from Russia, they said, adding that for now, the US administration has not indicated any penalty. “For now, there is nothing but you never know,” an analyst said.
From just 0.2 per cent before the Russia-Ukraine war to now accounting for 35-40 per cent of total crude imports, India’s reliance on Russian oil has surged — drawing fresh scrutiny with Trump announcing a penalty on top of a 25 per cent tariff, or tax, on all goods going to the US.
India historically bought most of its oil from the Middle East, including Iraq and Saudi Arabia. However, things changed when Russia invaded Ukraine in February 2022.
India, the world’s third-largest crude importer after China and the US, began snapping up Russian oil that was available at a discount after some in the West shunned it as a means to punish Moscow for its invasion of Ukraine.
From a market share of just 0.2 per cent in India’s import basket before the start of the Russia-Ukraine conflict, Russia overtook Iraq and Saudi Arabia to become India’s No.1 supplier, with a share as high as 40 per cent at one point of time.
This month, Russia supplied 36 per cent of all crude oil, which is converted into fuels like petrol and diesel, that India imported.
Announcing the imposition of 25 per cent tariff or tax on all Indian goods going to the US, Trump had said New Delhi “always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of energy, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE.”
“India will therefore be paying a tariff…
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