Trump Signs Executive Order Removing Tariff on India Over Russian Oil Imports
US President Donald Trump on Friday signed an executive order officially revoking the additional 25 per cent tariff that had been imposed on all imports from India. This punitive duty was specifically levied in response to New Delhi's continued purchases of Russian oil, according to a statement from the White House.
Trade Deal Finalization Precedes Tariff Removal
The significant policy shift comes just days after India and the United States successfully finalized a long-pending trade agreement. This development follows nearly a full year of persistent trade tensions and diplomatic friction between the two major economies. In the past, President Trump had repeatedly accused India of indirectly supporting Moscow's military actions in Ukraine by maintaining its oil procurement from Russia.
Details of the New Bilateral Trade Agreement
Earlier this week, President Trump announced the completion of a comprehensive trade agreement with India. Under the terms of this new pact:
- US tariffs on Indian goods have been substantially reduced to 18 per cent, down from the previous rate of 50 per cent.
- In return, India has formally agreed to halt all future purchases of Russian oil.
- India has also committed to lowering several key trade barriers that had hindered American exports.
A senior White House official had previously informed Reuters that the United States was withdrawing the punitive 25 per cent duty that had been imposed specifically over India's Russian oil imports. It is important to note that this duty had been an additional levy, placed on top of an existing 25 per cent "reciprocal" tariff.
India's Historical Reliance on Russian Oil
India has historically been a major purchaser of Russian crude oil, meeting approximately 90 per cent of its import requirements through long-term supply arrangements. Since Russia's invasion of Ukraine in 2022 and the subsequent imposition of Western sanctions on Russian energy exports, India's procurement of cheaper Russian oil provided a crucial buffer, helping to reduce the nation's overall import costs significantly.
Recent Decline in Indian Imports from Russia
However, India has recently initiated a noticeable reduction in these purchases. According to a detailed Reuters report, imports from Russia stood at about 1.2 million barrels per day in January. Projections indicate these figures are expected to decline to around 1 million barrels per day in February, with a further drop to approximately 800,000 barrels per day anticipated by March. This downward trend aligns with the commitments made under the new US-India trade agreement.
