Trumps hints at removing 25% tariffs on India over Russian oil row

The United States has hinted at a possible removal of the 25% tariff imposed on Indian goods, with a senior US official describing the levy as a “huge success” and suggesting there is now a path to take it off. The remarks came from US Treasury Secretary Scott Bessent during an interview at the World Economic Forum in Davos, where he pointed to a significant reduction in India’s purchases of Russian crude oil as a key factor.

Bessent noted that the additional 25% tariff was introduced to discourage Indian refinery purchases of discounted Russian oil after geopolitical tensions surrounding the Ukraine conflict, and that those purchases “have collapsed.” He said the tariffs are still in place but hinted that continued shifts in India’s energy sourcing could create conditions for their removal. “I would imagine there is a path to take them off,” he said, calling the tariff measure “a check and a huge success.”

The tariff was part of broader US trade action that saw cumulative duties on Indian imports rise sharply, complicating relations between New Delhi and Washington. Economists in India have previously warned that such high tariffs could dent economic growth, estimating impacts of up to 0.4 per cent on India’s GDP for the fiscal year 2025-26 if lower rates are not negotiated. Industries such as garments, electronics and auto parts have expressed concerns over uncertain tariff outcomes affecting exports to a key market.

The possibility of tariff relief comes amid ongoing bilateral trade negotiations aimed at addressing wider market access issues and reducing trade frictions between the two countries. Both sides continue to engage on terms of a potential deal, with officials indicating that resolving the tariff dispute is crucial for broader economic ties to progress.