US signals possible rollback of 25 pc tariff on India over Russian oil imports

The United States may be open to easing a 25 per cent tariff imposed on Indian imports over New Delhi’s purchase of Russian oil, US Treasury Secretary Scott Bessent has indicated, suggesting that a sharp decline in such imports could prompt a review of the measure.

Speaking to Politico on the sidelines of the World Economic Forum in Davos, Bessent said the tariff—introduced during the Trump administration—was intended to dissuade India from continuing energy trade with Russia following Moscow’s invasion of Ukraine. While the duty remains in force, he acknowledged that circumstances have changed.

According to Bessent, Indian refiners had earlier ramped up purchases of discounted Russian crude, taking advantage of lower prices after Western sanctions disrupted global energy markets. However, he said those imports have since fallen significantly.

“We put 25 per cent tariffs on India for buying Russian oil, and the Indian purchases by their refineries have collapsed,” Bessent told Politico. “I would imagine there is a path to take them off,” he added, describing the outcome as evidence that the tariff policy had achieved its objective.

Bessent also noted that the United States’ European allies had declined to impose similar penalties on India, despite its energy ties with Russia. He suggested this reluctance was driven by Europe’s desire to pursue a major trade agreement with New Delhi.

Despite the possibility of relief on the 25 per cent levy, India continues to face steep trade barriers in the US market.

Overall tariffs on Indian goods currently stand at 50 per cent, following a series of punitive measures introduced during Donald Trump’s presidency against countries that continued trading with Russia amid the Ukraine war.

In August 2025, Trump doubled duties on Indian imports from 25 per cent to 50 per cent, explicitly citing India’s ongoing energy relationship with Russia. The move added strain to bilateral trade ties, even as both sides expressed interest in a broader economic partnership.

Trump, however, has struck a conciliatory tone in recent remarks. Speaking exclusively to Moneycontrol in Davos, he described Prime Minister Narendra Modi as a close personal friend and voiced confidence that the two countries would ultimately resolve their trade differences.

“I have great respect for your Prime Minister. He’s a fantastic man and a friend of mine,” Trump said, signalling optimism that Washington and New Delhi could still reach a trade agreement despite the current tariff dispute.

Any decision to roll back the 25 per cent tariff would mark a significant step towards easing tensions and could provide momentum for renewed trade negotiations between the two democracies.