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US speaks in two voices on road to trade with India
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  • US speaks in two voices on road to trade with India

US speaks in two voices on road to trade with India

FP News Desk • August 22, 2025, 20:17:06 IST
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Even as the US moves ahead with plans to impose tariffs of up to 50% on Indian exports — accusing New Delhi of indirectly funding Russia’s — it continues to stress its commitment to deepening trade relations with India

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US speaks in two voices on road to trade with India
US President Donald Trump and Prime Minister Narendra Modi. Reuters File

Even as the United States moves ahead with plans to impose tariffs of up to 50% on Indian exports — accusing New Delhi of indirectly supporting Russia’s war effort by buying discounted Russian oil — it continues to stress its commitment to deepening trade relations with India.

The seemingly contradictory stance has drawn criticism from several quarters, who view it as strategic double speak.

In a press conference on Thursday, US President Donald Trump’s trade adviser Peter Navarro reaffirmed the administration’s decision not to delay the tariff hike, set to take effect on August 27.

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Navarro alleged that India is profiting from refining Russian crude and indirectly funding Russia’s war machine, asserting that “the road to peace (in the ongoing Russia-Ukraine war) runs through India.”

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“I love India. Look, [Prime Minister Narendra] Modi is a great leader. But please, please India, like, look at what your role here is in the global economy and good here. It’s like, what you’re doing right now is not creating peace, it’s perpetuating the war,” Navarro said.

“They don’t need oil — it’s a refining profiteering scheme,” he added, claiming India is “using the money that they get from us when they sell us stuff” to buy Russian oil, refine it, and make significant profit, which he said eventually contributes to Russia’s arms buildup.

Navarro further argued that the US taxpayer is effectively subsidising Ukraine’s defence while countries like India, through their trade with Moscow, are undermining these efforts.

“So that’s insane, and President Trump sees that chessboard beautifully. And you guys need to write about that,” he told reporters in Washington, DC.

Despite this confrontational tone, the US State Department appeared to strike a more conciliatory note when asked by CNN-News18 if the tariffs would hurt the growing India-US strategic partnership.

“We value our ongoing engagement with the Government of India on trade and investment matters and look forward to continuing to advance a trade agreement that leads to a productive and balanced trade relationship between our two countries,” News 18 quoted a spokesperson as saying.

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This measured response stands in contrast to Navarro’s accusations — and has fueled criticism of the US administration’s inconsistent messaging.

Analysts point out that while the White House singles out India, it has been relatively silent on China’s much larger imports of Russian oil.

In July, Trump imposed an initial 25% tariff on select Indian exports and warned of an additional 25% hike set for August 27. According to US officials, these penalties are meant to “correct longstanding imbalances” in trade and signal disapproval over India’s continued energy ties with Moscow.

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“The President has made clear his desire to correct longstanding imbalances in international trade and bring back fairness to our trade relationships,” the State Department added.

Indian officials, however, maintain that energy imports are guided by national interest and affordability, not geopolitics. India has also reiterated that its trade decisions — including any future trade agreement with the U.S. — will not come at the cost of core domestic sectors like agriculture and fisheries.

Meanwhile, negotiations for a possible India-US trade deal are ongoing, with both sides expressing cautious optimism about progress later this year.

With inputs from agencies

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