‘There Is a Path’: Washington Signals Possible Rollback of Punitive Tariffs on New Delhi

US Treasury Secretary Scott Bessent has signalled that there may be a “path” to reduce tariffs on India, including a possible rollback of the 25% punitive duty imposed by Washington over New Delhi’s purchase of Russian oil and energy.

Speaking in an interview, Bessent said that while the tariffs remain in place, a sharp reduction in India’s purchases of Russian crude could provide grounds to reconsider the punitive measures introduced under the Trump administration.

Washington imposed a sweeping 50% tariff on Indian goods in August, including a 25% punitive component, making India one of the most heavily tariffed Asian economies. Bessent said the punitive duties were introduced to discourage India from buying Russian oil following Moscow’s invasion of Ukraine.

India emerged as one of the largest buyers of discounted Russian crude after the Russia–Ukraine war began in 2022. The US and other Western allies have repeatedly criticised these purchases, arguing that they have helped finance the war.

“We put 25% tariffs on India for buying Russian oil, and the Indian purchases by their refineries… have collapsed,” Bessent said in an interview with Politico on the sidelines of the annual World Economic Forum (WEF) summit in Davos. “I would imagine there is a path to take them off,” he added.

Bessent also noted that the European Union had refrained from imposing similar tariffs on India, as Brussels was keen to conclude a major trade deal with New Delhi. The India–EU Free Trade Agreement (FTA) is expected to be formally announced early next week.

According to Moneycontrol, US President Donald Trump, speaking at the WEF summit, referred to Prime Minister Narendra Modi as a close friend and expressed confidence that the US and India would reach a trade agreement despite ongoing tensions over tariffs.

“I have great respect for your Prime Minister. He’s a fantastic man and a friend of mine,” Trump said.