Former US President Donald Trump has voiced his displeasure with India’s ongoing trade relations with Russia, specifically concerning the purchase of Russian oil. In a statement published on Truth Social, Trump warned of impending tariff increases on Indian goods. He criticized India for buying large quantities of Russian oil and subsequently selling some of it in the open market for profit, suggesting this disregard for the impact of the war in Ukraine. This declaration has ignited conversations amongst international trade analysts, with formal responses from officials yet to be issued. The move is anticipated to become a key discussion point in upcoming trade talks. Analysis from the Global Trade Research Initiative (GTRI) suggests that the proposed tariff hikes could lead to a considerable decrease in Indian exports to the US, potentially around 30%, spanning from the fiscal year 2024-25 to the subsequent year. Labor-intensive industries such as garments and textiles would be most heavily affected. The GTRI report also highlighted the fact that these tariffs would put India at a disadvantage relative to its regional competitors, which currently have more favorable trade terms. The GTRI has proposed a five-point action plan to help mitigate the negative impacts, including financial aid for small and medium-sized enterprises (MSMEs) and the strategic use of free trade agreements.
