India-US Tariff War / Modi is my good friend, but he is not happy with me, the reason is 50% tariff on India– Trump said again

Former US President Donald Trump recently made several significant statements regarding India and Prime Minister Narendra Modi, with the 50% tariffs imposed on India and the purchase of Russian oil being central issues. Speaking at a meeting of House Republican Party members in Washington, Trump asserted that Prime Minister Modi is 'not too happy' with him because Washington has imposed a 50% tariff on Delhi, partly due to its purchase of Russian oil. These remarks have once again brought the trade relations and geopolitical dynamics between the two nations into sharp focus.

The Core of the Dispute: Tariffs and Russian Oil

According to Trump, a total of 50% tariff has been imposed on India, with an additional 25% specifically attributed to India's purchase of oil from Russia, while this tariff is part of the US's broader efforts to reduce its trade deficit with India and address its concerns regarding India's large-scale acquisition of Russian crude oil, particularly in the context of the Russia-Ukraine conflict. Trump explicitly stated that these duties are making it difficult for India to sell its goods in the American market, directly impacting India's exports, while the US administration believes that by purchasing oil from Russia, India is indirectly funding the attacks on Ukraine, a stance that the US has consistently criticized.

PM Modi's Alleged Meeting and Relationship

Donald Trump also claimed that Prime Minister Modi himself came to meet him. Trump recounted, 'He came to me and said, 'Sir, can I meet you? ' And I said, 'Yes. '' However, Trump didn't specify when or where this alleged meeting took place. Trump also mentioned having 'very good relations' with PM Modi, yet simultaneously noted Modi's alleged unhappiness over the tariffs. Trump had made a similar statement the previous day, claiming that India decided to reduce oil imports from Russia to 'make him happy. ' He stated, 'They wanted to make me happy, while prime Minister Modi is a very good person. He knew I wasn't happy, so it was necessary to make me happy. ' These statements highlight Trump's characteristic diplomatic style and his emphasis on personal relationships.

The Apache Helicopter Deal

Trump also referenced India's defense procurements, while he stated that India had been approaching him for Apache helicopters for 'many years. ' Trump claimed, 'We're changing it. India has ordered 68 Apache helicopters, while ' This remark underscores the growing defense cooperation between India and the United States, where the US has emerged as a key defense supplier for India. This substantial order for Apache helicopters signifies the depth of the strategic. Partnership between the two countries, even amidst disagreements over trade and energy imports.

India's Stance on Oil Imports

India has consistently defended its decision to import oil from Russia. The Indian government has clarified that these oil purchases are based on national interest and the necessity to ensure an affordable fuel supply for its citizens. India has also reiterated its commitment to continuing dialogue with all global partners while safeguarding its strategic and economic priorities. After the Ukraine war began in 2022, India emerged as the largest buyer. Of Russian oil, which helped it secure discounted rates despite high international market prices. This policy represents a pragmatic approach by India to ensure its energy security.

US Pressure and Warnings

Trump had previously warned that Washington could further increase tariffs on Indian goods if New Delhi didn't address US concerns regarding Russian oil imports. The US is actively seeking to reduce its trade deficit with India, and last year, it doubled import tariffs on Indian goods to 50%, citing India's large-scale crude oil purchases from Russia. This move was part of a pressure tactic by the US, aimed at compelling India to reconsider its energy procurement policies.

India's Shift Away from Russian Oil

Recent data indicates that India has reduced its crude oil imports from Russia for the first time since 2021, while according to a Reuters report, India's Russian oil imports decreased from approximately 1. 77 million barrels per day in November to about 1. 2 million barrels per day in December. Projections suggest this figure could fall below 1 million barrels per day, with January data expected to show a significant decline. Part of this reduction can be attributed to US sanctions imposed on major Russian oil companies like Rosneft and Lukoil, which came into effect in November 2021. Senator Lindsey Graham also claimed that the Indian Ambassador appealed for the removal of the extra 25% tariff, citing India's reduced purchases from Russia.

Economic Factors Driving India's Decisions

Several economic factors are also responsible for the reduction in Russian oil imports. After the Ukraine war, Russia began selling crude oil at a discount of $20-25 per barrel when international market prices were around $130 per barrel. This discount was highly economical for India, while however, international crude oil prices have now dropped to $63 per barrel, and Russia has also reduced its discounts to a mere $1. 5-2 per barrel. With such a minimal concession, India is no longer receiving the same benefit as before, and Also, shipping and insurance costs for Russian oil are higher. Consequently, India is now reverting to more stable and reliable suppliers such as Saudi Arabia, UAE, and. The US, as the significant price differential no longer exists, making purchases from traditional suppliers more viable.

Diplomatic Efforts and Trade Negotiations

Discussions are ongoing between India and the US to resolve the tariff dispute. India seeks a reduction of the total 50% tariff to 15% and the. Complete removal of the additional 25% penalty imposed for Russian crude oil purchases. There is hope for a concrete decision from these negotiations in. The new year, which could lead to an improvement in trade relations. Both countries are also engaged in talks for a potential trade agreement, aiming to address these contentious issues and foster a more stable and mutually beneficial trade environment. The resolution of these trade disputes is crucial for strengthening. The overall strategic partnership between India and the United States.

VIDEO | Washington, USA: “I have a very good relationship with PM Modi, but he is not happy with me as India is paying high tariffs due to its purchase of Russian oil,” says US President Donald Trump.

(Source: Third Party)

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