Will India-US Trade Relations Soon Improve?

New Delhi, Sep 15 (NationPress) In light of optimistic signs emerging for a revival of trade discussions with the United States, India has reported a notable increase in its estimated cumulative exports for the period of April-August 2025 compared to the previous year.

The total exports (both merchandise and services) from April to August 2025 are projected to be $349.35 billion, up from $329.03 billion during the same timeframe last year, marking a 6.18 percent growth, as per a statement from the Commerce Ministry.

Despite the backdrop of global uncertainties and shifting trade regulations, Indian exporters have excelled, as highlighted by Commerce Secretary Sunil Barthwal in a recent media briefing.

The complete impact of the additional tariffs will be clearer when more trade data is released.

US President Donald Trump’s imposition of a 25 percent additional tariff, raising the total tariff on imports from India to 50 percent, took effect on August 27.

This increased tariff was largely viewed as a punitive measure in response to India's significant rise in oil imports from Russia, which are seen as benefitting Moscow amidst the ongoing conflict in Ukraine.

However, a noticeable shift in the White House's tone was evident as Trump engaged in friendly exchanges with Prime Minister Narendra Modi on social media, suggesting a potential thaw in relations.

Moreover, Trump's nominee for the next US ambassador to India, Sergio Gor, emphasized the strong rapport between President Trump and Prime Minister Modi, noting Modi's ability to garner praise even amidst trade-related criticisms.

Meanwhile, Trump’s focus shifted towards Russia and China, as he called on NATO allies to impose additional tariffs on China for its purchases of Russian oil.

He also expressed readiness to impose further sanctions on Russia should European Union partners cease buying its oil and unite in a coordinated response against Moscow.

Interestingly, numerous NATO members remain among the largest purchasers of fossil fuels from Russia, undermining the alliance's pressure on Moscow.

According to the Centre for Research on Energy and Clean Air (CREA) based in Finland, an analysis of Russian fossil fuel exports and sanctions in August 2025 indicated that the five largest EU importers of Russian fossil fuels collectively paid Russia EUR 979 million last month.

India held the position of the second-largest buyer of Russian fossil fuels, with total imports reaching EUR 3.6 billion. The bulk of India's purchases, at 78 percent (EUR 2.9 billion), consisted of crude oil, followed by coal at 14 percent (EUR 510 million) and oil products at 8 percent (EUR 282 million).

In terms of LNG imports, the EU was the largest buyer at 50 percent, followed by China at 21 percent and Japan at 18 percent. For Russian pipeline gas, the EU again led with 35 percent, while China and Türkiye followed closely with 30 percent and 28 percent, respectively.

In August, China accounted for 47 percent of Russia’s crude oil exports, followed by India at 38 percent, the EU at 6 percent, and Türkiye also at 6 percent, according to the analysis.

Thus, Trump’s strategy seems to compel a unified action to halt Russian oil purchases and curb China's energy-linked exports through elevated tariffs—whether through incentives or punitive measures.

On the diplomatic front, US trade negotiators are slated to arrive in Delhi on Tuesday for their first face-to-face meeting after Washington's implementation of additional tariffs on India last month.

The sixth round of discussions was initially set for August 25 but was postponed by the US.