India is facing a significant economic and diplomatic threat from former US President Donald Trump, who has renewed his hard-line stance against New Delhi’s trade policies. Trump has warned of additional punitive tariffs that could drastically impact bilateral relations.

Trump Targets India Over Russian Oil Imports

Trump specifically criticized India for its continued purchases of Russian crude oil. He warned that unless New Delhi reduces these imports, the United States could impose higher tariffs on Indian goods. These tariffs could reach levels that severely affect trade, especially for sectors dependent on the US market.

The move comes amid ongoing US efforts to economically isolate Russia over its war in Ukraine.

Market Reaction and Economic Impact

Financial markets responded swiftly: the Indian rupee fell against the US dollar, and investors expressed concern over potential trade disruptions. Economists warn that further tariffs could negatively impact India’s export-oriented industries, including textiles, gems, jewellery, leather, and manufacturing.

Political Response in India

Domestically, the tariff threats have triggered political debate. Opposition parties criticized Prime Minister Narendra Modi’s “personal diplomacy” with Trump, questioning its effectiveness in safeguarding India's economic interests. Some lawmakers, however, remain confident in India’s strategic autonomy and long-term economic resilience.

Future Prospects and Diplomatic Challenges

The escalating tariff dispute represents one of the most serious challenges to India-US relations in recent years. While negotiations continue, India must balance its economic and foreign policy objectives carefully amid these rising global tensions.