The United States has urged its G7 allies to impose tariffs on India and China for continuing to purchase discounted Russian oil. President Donald Trump, in his latest policy move, has already announced a 25% tariff on imports from India, saying it is necessary to pressure New Delhi to reduce its energy ties with Moscow.
Washington argues that India and China’s oil purchases are undermining Western sanctions against Russia. By buying Russian crude at lower rates, these countries are helping Moscow earn revenue, which, according to the U.S., is being used to finance its war efforts in Ukraine.
For India, this development comes at a sensitive time. Since 2022, India has increased its dependence on Russian oil to manage inflation and meet its rising energy demands. Cheaper imports from Russia have allowed the government to keep fuel prices stable for consumers. However, U.S. tariffs could now threaten Indian exports in key sectors like textiles, pharmaceuticals, and engineering goods, which heavily rely on the American market.
China is also under similar pressure, but Beijing has so far resisted aligning with Western sanctions. Experts suggest that if the G7 accepts Washington’s proposal, it could create deeper divisions in global trade, pitting Western economies against Asia’s two largest markets.
India has not yet issued an official response, but government sources say New Delhi will likely use diplomatic channels to explain its position. Indian officials stress that the country’s oil trade is based on energy security needs and is not meant to take sides in geopolitical conflicts.
The next G7 summit will be crucial. If the proposal goes through, it could mark a turning point in economic relations, reshaping India-US ties and intensifying global trade tensions.