'India must be firm; its Russian oil deal is longstanding and sovereign'

In a dramatic escalation of India-US trade tensions, US President Donald Trump has imposed additional tariffs—bringing duties on Indian exports to as high as 50%. Veteran journalist and trade analyst D Ravi Kanth breaks down what this means for India’s exports, diplomacy, and future trade prospects.

How do you interpret Trump’s 50% tariff announcement on Indian goods?

This is a two-stage move. A 25% tariff kicks in on Indian exports—textiles, pharmaceuticals, prawns, diamond and jewellery, auto parts—from August 7. Within three weeks, another 25% is added due to India’s oil purchases from Russia, effective August 27. The move is coercive and a form of bullying by a declining global power. The Indian Foreign Office has condemned the action as unfair, unreasonable, and unjustified.

What options does India have, especially considering its oil trade with Russia benefits global markets?

India’s oil trade with Russia is longstanding and sovereign. There is a selective targeting of India that's unjustified—especially since other nations, including China, also trade Russian oil. Withdrawing from this trade would damage relations not just in energy but also in defence for India.

Is Trump hardening his negotiating stance ahead of future trade talks with India?

That could well be the case. India may have “shown its hand” too early, considering Prime Minister Narendra Modi’s enthusiastic trade outreach. Trump’s tactics resemble imperial preferences, demanding zero tariffs and market opening, which is economically and socially incompatible with India’s agrarian structure.

What impact will these tariffs have on the Indian economy, and how can India respond?

Sectors such as textiles, jewellery, pharma, and seafood will suffer. India must resist unilateral pressure, uphold its principles, and diversify relationships to offset disruptions.

Could non-trade areas like defence cooperation or semiconductor ties with the US be affected?

The vast Indian diaspora and the strategic importance of India–US ties are important. But pressure from US policymakers may spill into defence and tech sectors, raising costs and jeopardising partnerships, including with Apple’s expanded manufacturing footprint in India.

Is Trump's ego influencing this tariff escalation by continually shifting demands?

This is entirely possible. Irrational considerations might be at play, and India must not appease Trump’s perceived ego—because that only invites further demands. The current US posture signals a declining hegemony fearful of multilateral pushback.

What’s at stake if India doesn’t stand firm?

If India doesn’t take a stand now, it will lose strategic freedom in external ties and risk being railroaded into unfair terms across sectors. The move marks an existential moment for India’s foreign policy autonomy.

The content above has been transcribed from video using a fine‑tuned AI model. To ensure accuracy, quality, and editorial integrity, we employ a Human‑In‑The‑Loop (HITL) process. While AI assists in creating the initial draft, our experienced editorial team carefully reviews, edits, and refines the content before publication. At The Federal, we combine the efficiency of AI with the expertise of human editors to deliver reliable and insightful journalism.