Unjustified, unreasonable: MEA hits back as Trump vows to hike tariffs

Less than a week after imposing 25 per cent tariffs on Indian goods, US President Donald Trump on Monday warned he would “substantially” increase the levies over India’s purchase of Russian oil amidst the Ukraine war. The remark drew a sharp response from New Delhi, with the Ministry of External Affairs calling the targeting of India “unjustified and unreasonable” and asserting that it would take all necessary measures to “safeguard its national interests and economic security like any major economy”.

In a post on Truth Social, Trump accused India of profiting by reselling Russian oil in the open market, saying, “They don’t care how many people in Ukraine are being killed by the Russian war machine. Because of this, I will be substantially raising the tariff paid by India to the US.”

In response, New Delhi said India’s imports were aimed at ensuring predictable and affordable energy costs for Indian consumers. “India has been targeted by the US and the European Union for importing oil from Russia after the commencement of the Ukraine conflict. These imports are a necessity compelled by global market conditions. It is, however, revealing that the very nations criticising India are themselves trading with Russia. Unlike our case, such trade is not even a vital national compulsion,” the MEA said in a statement late on Monday.

The ministry pointed out that in 2024, the European Union had bilateral trade worth €67.5 billion in goods with Russia, along with an estimated €17.2 billion in services trade in 2023, significantly higher than India’s total trade with Russia during that period. “European imports of LNG in 2024 reached a record 16.5 million tonnes, surpassing the previous record of 15.21 million tonnes in 2022. Europe-Russia trade includes not just energy, but also fertilisers, mining products, chemicals, iron and steel and machinery and transport equipment,” it said.

As for the US, the ministry noted it continued to import uranium hexafluoride for its nuclear industry, palladium for its EV sector, as well as fertilisers and chemicals from Russia.

New Delhi also underlined that India began importing more from Russia after traditional suppliers diverted their shipments to Europe following the outbreak of the conflict. “At that time, the US actively encouraged such imports by India to help stabilise global energy markets,” the ministry said.

Trump’s fresh tariff threat came just two days after he claimed, citing media reports, that India had stopped purchasing oil from Russia. That assertion was refuted by Indian officials, who made it clear the country would not come under pressure and would continue to buy oil from the most competitive suppliers.

As the world’s third-largest oil importer, India sourced over 30 per cent of its crude from Russia in 2024, a surge from just 0.2 per cent before the Ukraine conflict, driven by steep discounts offered by Moscow.

The latest US tariffs, set to take effect August 7, target Indian imports and include threats of additional penalties for defence and energy deals with Russia. While Trump initially paused these measures for negotiations, the failure to secure agreements has led to their revival.

Meanwhile, the Union Government is considering to support the worst-affected sectors due to the US tariffs, an official said. “The government hopes that US importers can absorb some of the cost, given America’s strong purchasing power, but contingency plans, including possible financial support for exporters, are under discussion, the official said, adding that the government “also expects that not all the sectors will be dented by the levies and on certain tariff lines, the exporters would be able to bear the brunt”.

There are some sectors such as textile and apparels, which face $10.7 billion exposure, that will be the worst hit. “The government is holding meeting with the stakeholders to assess the impact and it may soon come up with a support package,” the official said. Additionally, New Delhi is also pinning hopes on the next round of bilateral trade talks scheduled for August 25 to mitigate the crisis.

Analysts warn that the tariffs could slash India’s US exports by nearly 30 per cent, from $86.5 billion in 2024-25 to around $60.6 billion in 2025-26. The Global Trade Research Initiative highlights that the duties place India at a severe disadvantage compared to competitors like Vietnam, Bangladesh, and Mexico, which benefit from lower or zero tariffs.