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Trump Warns India of Swift Tariff Hikes over Russian Oil, Says Modi ‘Knew I Was Not Happy’
Moneylife Digital Team 05 January 2026
Economy & Nation
US president Donald Trump has publicly linked India’s recent reduction in Russian oil purchases to trade pressure from Washington, warning that the US can raise tariffs on Indian goods 'very quickly' if New Delhi fails to address American concerns.
 
Speaking to reporters aboard Air Force One on 4th January, while returning to Washington DC from Florida, president Trump said prime minister (PM) Narendra Modi was aware of his displeasure over India’s continued energy ties with Moscow and adjusted policy accordingly.
 
“(Mr) Modi is a very good man. He’s a good guy,” Mr Trump said. “He knew I was not happy, and it was important to make me happy. They do trade, and we can raise tariffs on them very quickly. It would be very bad for them.”
 
Mr Trump’s remarks came amid renewed pressure from Washington on countries continuing to buy Russian oil, despite Western sanctions imposed after the Ukraine war. India emerged as the largest buyer of discounted Russian seaborne crude following the outbreak of the conflict in 2022, drawing criticism from the US and its allies, who argue that oil revenues are sustaining Russia’s war effort.
 
US has already imposed steep duties on Indian goods, doubling tariffs to 50% last year, with 25% directly linked to India’s Russian oil purchases. US has said the measures are part of a broader effort to narrow its trade deficit with India and reshape trade ties.
 
While the two countries have been negotiating a trade agreement, talks have faced repeated setbacks, including disagreements over market access for US agricultural products.
 
US senator Lindsey Graham, who was travelling with president Trump, says tariff pressure has already forced India to reconsider its oil sourcing. Mr Graham credited the existing tariff regime for India’s reduced intake of Russian crude and argued that trade penalties are an effective foreign policy tool.
 
“I really believe what the president (Trump) did with India is the chief reason India is now buying substantially less Russian oil,” Mr Graham says, recounting a recent interaction at the Indian ambassador’s residence where the focus was on seeking tariff relief. (Watch 16.59 onwards from the video shared below on X by Rapid Response 47, the official White House rapid response account.)
 
 
Mr Graham is one of the sponsors of the Sanctioning Russia Act of 2025, a proposed law that would authorise the US president to impose secondary tariffs of up to 500% on countries that continue purchasing Russian oil & gas, if Moscow does not move towards ending the war in Ukraine. The Bill currently has 85 co-sponsors in the US Senate.
 
“If you want to end this conflict, you have to put pressure on Putin’s customers,” Mr Graham says, adding that the proposed legislation would give the president full discretion to decide tariff levels.
 
Stricter sanctions by US and the European Union (EU) have already had a tangible impact on Russian oil flows to India. According to market data, India’s imports of Russian crude fell to a three-year low of around 1.2mn (million) barrels per day (bpd) in December, down nearly 40% from the peak recorded in June.
 
Despite the decline, India has consistently defended its energy policy, arguing that affordable Russian supplies are critical to its energy security. New Delhi has also pushed back against what it describes as unilateral pressure, maintaining that its purchases comply with international rules.
 
Although trade tensions remain high, both sides have kept diplomatic channels open. President Trump and PM Modi have remained in contact and negotiations on a broader trade deal have resumed after stalling last year.
 
However, Russian oil imports continue to be a key sticking point. President Trump has made it clear that trade leverage remains firmly in Washington’s hands, repeating that tariffs could be escalated swiftly, if countries reverse course.
 
“We can raise tariffs on them very quickly,” Mr Trump stated, underscoring his administration’s strategy of using trade measures alongside sanctions to reshape global energy and geopolitical alignments.
 
The latest comments signal that India’s energy ties with Russia will remain closely intertwined with its trade relationship with US, with tariffs continuing to serve as a central pressure point in Washington’s approach.
Comments
ajeya
2 months ago
India should make any import from America attract ZERO tariff and challenge America to do the same. Sometimes I think Indian state is idiot, American cars are dead in India. Harleys are also dead. America with $80,000 per capita can hardly sell anything to Indians with below $3,000 per capita.
Central government fear a lot, Who is going to buy Imported American corn or Soya? It will be highly unaffordable to 90% + Indians. If still 1-2% Indians (High income population) feels like eating imported American corn or Soya or Chicken then let them have it. We still import Swiss Chocolates.
Reply
Kamal Garg
Replied to ajeya comment 2 months ago
I think a valid point worth examination. It would be better if other readers also pour-in their comments on this so that a well considered point is taken.
Reply
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