In a significant escalation of trade tensions, the United States has explicitly linked its punitive trade measures against India to New Delhi's continued purchases of Russian crude oil, warning that there will be no relief unless India changes its stance.
The hardening of the US position came just a day after steep new tariffs of 50% on certain Indian goods took effect on Wednesday. On Thursday, Kevin Hassett, Director of the National Economic Council and a top economic adviser to the US President, issued a stark warning, stating that Washington's stance on tariffs would not ease if India fails to curb its Russian oil trade.
"If the Indians don't budge, I don't think President Trump will," Hassett stated bluntly. The 50% tariff rate is among the highest the US imposes, placing India in a category shared only by Brazil.
A "Complicated" Nexus of Trade and Geopolitics
Hassett described the ongoing trade negotiations between the world's largest democracy and the world's largest economy as "complicated," citing two primary obstacles.
"Part of it has been tied to the pressure we've been trying to put on Russia in order to secure a peace deal and save millions of lives," he said, directly connecting trade talks to the broader US strategy of economically isolating Russia over its actions in Ukraine. "And then there's the Indian intransigence about opening their markets to our products."
This sentiment was echoed by US Treasury Secretary Scott Bessent, who earlier indicated that the high tariffs were "not just over India's purchase of Russian oil" but also a result of the frustratingly slow progress in bilateral trade talks.
"I'd thought we'd have a deal in May or June; that India could be one of the earliest deals. But they, kind of, tapped us along," Bessent told Fox Business, accusing New Delhi of being "a bit uncooperative" during the protracted negotiations. "This is a very complicated relationship."
A Marathon, Not a Sprint
Despite the tough rhetoric, both officials hinted at a long-term perspective. Hassett termed the negotiations a "marathon," suggesting that a resolution would require patience.
"When you look at trade negotiations, one lesson we've all learnt is that you need to keep your eyes on the horizon and recognise that there are going to be ebbs and flows before we reach the final position," he advised.
Bessent also struck a cautiously optimistic note for the future, underscoring the fundamental strategic importance of the relationship. "I do think India is the world's largest democracy, and the US is the world's largest economy. I think at the end of the day we will come together."
The statements from top US officials mark a clear turning point, moving beyond bilateral trade deficits and market access issues to explicitly include foreign policy alignment as a core determinant of economic relations. The ball now appears to be in India's court, as it weighs its energy security needs and economic interests against its strategic partnership with the United States.
Leave Your Comment