Trump Freezes India Trade Talks, Imposes 50% Tariff Over Russian Oil Row; Modi Vows to Protect Farmer Interests

Former U.S. President Donald Trump has once again reignited global trade tensions by imposing a 50% tariff on Indian imports and declaring a pause on all trade negotiations with New Delhi. The trigger: India’s continued purchase of discounted Russian crude oil, which Trump has repeatedly criticised as undermining U.S.-led sanctions on Moscow.

This abrupt escalation, revealed during a policy address in Ohio on Tuesday, marks a dramatic turn in what had been a cautiously warming trade relationship between the two countries. It also underscores the geopolitical balancing act India has maintained between the West and Russia since the outbreak of the Ukraine war.

Tariffs and Trade Talks on Ice

Trump, in his remarks, said that trade talks with India will remain suspended until there is “complete clarity” on New Delhi’s position regarding oil imports from Russia. He accused India of undercutting global sanctions by continuing to buy Russian crude at discounted prices, effectively providing Moscow with a steady stream of revenue.

This follows his earlier decision to reintroduce tariffs on a range of Chinese and Indian goods, a move that economists see as politically motivated ahead of the US elections.

India Responds: “No Compromise on Farmers’ Welfare”

Prime Minister Narendra Modi responded firmly in a press statement from New Delhi, stating unequivocally that India will not bow to pressure, particularly if the cost comes at the expense of its farmers, fishermen, or rural communities. He added, “Even if we have to pay a heavy price, we will protect the interests of those who sustain this nation’s economy.”

His remarks appear directed at Trump’s administration but also resonate domestically, where rural voters form a key political base.

Strategic Partnership in a Fragile Phase

Despite the sharp rhetoric, U.S. State Department officials attempted to downplay the tension. A senior spokesperson referred to India as a “strategic partner,” noting that bilateral relations remain strong in areas like defence cooperation, clean energy, and technology exchange.

Behind the scenes, however, diplomatic sources indicate that scheduled trade talks and joint energy consultations have been “indefinitely postponed.”

What’s at Stake for Both U.S & India?

The disruption comes just as India was preparing to finalise a series of investment frameworks with the U.S. in sectors like semiconductors, renewable energy, and fintech.

Looking Ahead

Experts suggest the situation could cool down diplomatically, but not without adjustments. “The U.S. is testing India’s red lines. This is about more than just oil—it's about leverage,” said a former ambassador to Washington.

New Delhi is now expected to pivot further towards BRICS partners, while continuing to engage Washington through back-channel diplomacy.