The United States has signaled a possible easing of trade tensions with India, with Treasury Secretary Scott Bessent suggesting that the additional twenty five percent tariff imposed over New Delhi’s purchase of Russian oil could be rolled back. He cited a sharp decline in such imports by Indian refineries as evidence that the measure had achieved its goal.
Speaking to Politico on the sidelines of the World Economic Forum in Davos, Bessent said there is now a path to remove the extra duties after Indian refiners significantly reduced purchases from Moscow.
“We put twenty five percent tariffs on India for buying Russian oil, and the Indian purchases by their refineries have collapsed,” Bessent said. “That is a success. The Russian oil tariffs are still on, but I would imagine there is a path to take them off now.”
India is currently facing a total tariff burden of fifty percent on its exports to the United States after President Donald Trump doubled duties in August twenty twenty five, citing India’s energy ties with Russia.
Analysts believe the additional tariffs are being used as leverage in broader trade negotiations between Washington and New Delhi, which have dragged on for months. Bessent’s remarks have therefore been interpreted as a possible sign of progress in those talks.
His comments stand in contrast to recent remarks by US Commerce Secretary Howard Lutnick, who suggested negotiations stalled because Prime Minister Narendra Modi did not reach out to President Trump at a critical moment. India swiftly rejected that claim.
Optimism resurfaced after the new US ambassador to India, Sergio Gor, said trade negotiations between the two countries were still ongoing. President Trump also struck a conciliatory tone at Davos, telling Moneycontrol that he had great respect for Modi and was confident both sides would reach a trade agreement despite tariff related tensions.
Trump has repeatedly described Modi as a close friend and said the two leaders remain in regular contact.
Bessent’s assertion that Indian refiners have cut Russian oil imports echoes earlier claims by Trump, who said in November that India had largely stopped buying oil from Russia. However, India has never officially confirmed such a shift. After Trump claimed last year that Modi had assured him India would halt Russian oil purchases, New Delhi dismissed the statement, saying no such conversation had taken place.
Earlier this week, Bessent told Fox Business that India began buying Russian oil after the Ukraine conflict but scaled back after the imposition of tariffs. He also referenced a proposal in the US Senate that would allow for far higher penalties on secondary purchases and resale of Russian oil, though he suggested the president already has sufficient authority to act.
Bessent’s latest comments come as President Trump again voiced confidence in bilateral ties, saying the United States and India were likely to reach a good deal, even as any tariff relief remains linked to Washington’s assessment of India’s energy trade with Russia.
Leave a comment