India
Union Commerce and Industry Minister Piyush Goyal has declared that India will not “bow down” to the United States’ recent imposition of high tariffs, emphasising the nation’s resolve to prioritise self-respect and explore alternative global opportunities. Speaking at a construction industry event in New Delhi on Friday, 29 August 2025, Goyal addressed the escalating trade friction, stating India is “always ready if anyone wants to have a free trade agreement with us”. However, he firmly added that India “will neither bow down nor ever appear weak”. “We will continue to move together and capture new markets,” he asserted, signalling a shift towards diversification to mitigate the impact of the tariffs.
The 50-percent levies on many Indian imports into the United States took effect this week as punishment for New Delhi’s massive purchases of Russian oil, part of US efforts to pressure Moscow into ending its war in Ukraine. Since his return to the White House this year, US President Donald Trump has wielded tariffs as a wide-ranging policy tool, with the levies upending global trade. The tariffs, which double the rate on key sectors like steel, textiles, chemicals, gems, and jewelry, follow an initial 25 percent penalty announced earlier in August 2025, with an additional 25 percent tied specifically to India’s continued Russian oil imports. Analysts warn that the 50 percent duty is akin to a trade embargo and is likely to harm smaller firms, potentially slashing Indian exports to the US by significant margins.
Goyal’s comments come amid strained US-India ties, with New Delhi earlier criticising the levies as “unfair, unjustified and unreasonable”. Trade talks between the two countries have stumbled over agriculture and dairy markets, where Trump seeks greater US access, while Indian Prime Minister Narendra Modi remains determined to shield India’s farmers, a huge voter bloc. The US was India’s top export destination in 2024, with shipments worth $87.3 billion, but the new tariffs threaten to disrupt this, with exporters already reporting cancelled orders and losses to rivals such as Bangladesh and Vietnam. Fears of heavy job cuts loom large in labour-intensive industries like textiles, seafood, and jewelry.
Government Measures to Boost Exports and Diversify
In response to the challenges, Goyal assured that the government would be coming out with several measures in the coming days to support every sector and boost exports. “I can say with confidence that India’s exports this year will exceed 2024-25 numbers,” he said, expressing optimism despite the headwinds. He highlighted efforts to identify sectors for diversification, noting that the self-confidence of 140 crore Indians won’t tolerate any type of discrimination. Commerce ministry officials are actively looking at new markets in Africa, Latin America, and Southeast Asia to offset potential losses, with a focus on enhancing competitiveness through subsidies, skill development, and trade promotions.
This defiant approach aligns with India’s broader strategy to maintain energy security amid global volatility. Despite the tariffs, India plans to increase its Russian oil imports by 10-20 percent in September 2025, as reported by industry analysts. Russian crude now accounts for over 30 percent of India’s oil supply, saving the country around $17 billion through discounted purchases, according to experts. However, former RBI Governor Raghuram Rajan has cautioned that India must weigh the benefits of these imports against tariff-induced losses, suggesting that refiners’ excess profits could be redirected to support affected exporters. “After all, there are refiners who are making excess profits. Do they still make those excess profits? Should we take some of those profits and benefit some of the exporters who are being hurt by the fact that they’re buying oil from Russia?” Rajan asked.
Broader Geopolitical Context and Implications
The tariffs represent more than a trade dispute, with US trade advisor Peter Navarro accusing India of acting as a “massive refining hub & oil money laundromat for the Kremlin” by processing and re-exporting Russian oil. Navarro has pushed for the 50 percent tariffs unless India halts these purchases, framing it as indirect funding for Russia’s war in Ukraine. Interestingly, India has become the top diesel supplier to Ukraine, providing 15.5 percent of its imported diesel in July 2025, highlighting the complex interplay of energy diplomacy.
Former Ambassador to the US Navtej Sarna views the tariffs as an attempt to coerce India on larger matters beyond trade or oil, advising that the country should endure short-term pain for long-term gains. “It’s not about Russian oil or even trade. It is about coercing India on larger matters. We must suffer short-term losses (tariffs) for long term gains,” Sarna stated. This perspective gains traction amid upcoming diplomatic engagements, including Russian President Vladimir Putin’s visit to India in December 2025 and a Modi-Putin meeting on 1 September 2025 at the SCO Summit in Tianjin, China. Discussions will cover defence, trade, technology, and global cooperation, underscoring deepening India-Russia ties despite Western pressures.
The US measures have also drawn criticism for inconsistency, as the US and Europe continue billions in trade with Russia, while targeting India selectively. China, the largest buyer of Russian oil, faces no similar penalties, raising questions about fairness. A US court ruling has even questioned the legal basis of Trump’s sweeping tariffs, potentially offering India leverage in future negotiations.
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