Business & Economics
Trump Dangles New Tariff Hike to Force India Off Russian Crude
On 5 Jan 2026 President Trump publicly warned he could push U.S. tariffs on Indian goods beyond the already-doubled 50 % level unless New Delhi further slashes its purchases of Russian oil, tying energy compliance to a still-unsettled bilateral trade deal.
Focusing Facts
- Russian oil arrivals to India slid to ~1.2 million bpd in Dec 2025, down roughly 40 % from the mid-2025 peak, according to Kpler.
- Sen. Lindsey Graham’s Sanctioning Russia Act, authorizing secondary tariffs of up to 500 %, has 85 Senate co-sponsors as of 5 Jan 2026.
- India’s NIFTY IT index fell about 2.5 % on 6 Jan 2026, hitting a one-month low on tariff-escalation fears.
Context
Washington has wielded tariffs as a geopolitical club before—from the 1930 Smoot-Hawley duties that aggravated global depression to the 1987 sanctions on Toshiba for selling milling machines to the USSR—but rarely has it so openly linked a partner’s energy choices to market access. Trump’s threat reflects two longer arcs: (1) the post-2018 normalisation of tariffs as quick-trigger executive tools rather than negotiated last resorts, and (2) the expansion of secondary sanctions that attempt to globalise U.S. foreign-policy aims by coercing third-party trade. If the world continues down this path, the 2020s could echo the 1970s oil-politics era—only with tariffs, not OPEC embargoes, weaponised to redirect flows. Over a century, such moves may hasten the fragmentation of the trading system the U.S. itself architected after 1945; partners faced with ever-shifting tariff leverage will diversify away from dollar-centric commerce, as Japan and the EU quietly began after the Trump tariffs of 2018-20. Whether this moment is a blip or a pivot depends on if Congress and future presidents keep the 500 % hammer within arm’s reach—history suggests once a coercive instrument proves useful, it seldom returns to the toolbox.
Perspectives
Right-leaning U.S. media
e.g., New York Post — Cast Trump’s tariff threat as tough, effective leverage to choke off funds for Putin by forcing India to slash Russian-oil buys. Tends to celebrate Trump’s hard-line posture while glossing over collateral damage to Indian exporters or the legal controversy around presidential tariff powers.
Indian mainstream and business press
e.g., The Times of India, The Financial Express — Frame Washington’s escalating tariffs as a serious economic and diplomatic squeeze that leaves New Delhi balancing energy security against the risk of deeper export losses. Highlights India’s predicament and paints U.S. demands as punitive, soft-pedalling the critique that Russian oil purchases bankroll the Ukraine war.
Middle-Eastern outlets critical of U.S. sanctions policy
e.g., Iran Front Page, Daily Sabah — Portray the tariff threat as another example of Washington weaponising trade to bully sovereign nations into its geopolitical agenda. Leans into an anti-U.S. narrative that underscores American coercion while overlooking Moscow’s actions that prompted the sanctions in the first place.