By Safe Investment August 14, 2025
Both Russia and the US have been important strategic partners for India for decades.
The current global situation has further sharpened the question of which side is more beneficial for India to be with?
US President Donald Trump has imposed an additional 25 percent tariff on India for buying oil from Russia.
This new tariff will be combined with the already imposed 25 percent tariff to make the total 50 percent.
According to the Stockholm International Peace Research Institute (SIPRI), arms imports from Russia between 2019 and 2023 were 36 percent.
At the same time, cheap crude oil coming from Russia in recent years has given great relief to the Indian economy.
On the other hand, America is India's largest trade partner. In the year 2024-25, trade between the two countries was $ 131.84 billion. At the same time, India's dependence on America has increased in the field of high-tech defence equipment to clean energy.
But the biggest question is whose support will be beneficial for India in the growing confrontation between America and Russia?
Profit and loss from economic perspective
India imports about 88 percent of its total oil requirement.
According to the data of the Ministry of Commerce, about 35 percent of India's total oil imports in the financial year 2024-25 came from Russia, whereas in the financial year 2018 it was only 1.3 percent.
After the Ukraine war, Western countries imposed sanctions on Russia. After that it is selling oil at cheap prices, which is benefiting India a lot.
Ajay Srivastava, founder of the search group Global Trade Research Initiative (GTRI), believes that India is saving ten billion dollars annually by buying cheap oil from Russia.
He says, "On the other hand, India has a trade surplus of about 41 billion dollars (more exports, less imports) with America. We are giving goods worth about 87 billion dollars to America."
Ajay Srivastava says, "If Trump's 50 percent tariff remains in place, India's exports can fall by up to 50 billion dollars. In the event of not buying oil from Russia, this tariff will remain at 25 percent and India's exports will fall by 30 billion."
The same thing is said by Robindra Sachdev, president of 'The Image India Institute'. He believes, "One percent of American tariff is equal to about one billion. If Trump imposes a 50 percent tariff, India will suffer a loss of about 50 billion dollars."
Sachdev says, "Not only money but jobs can also be lost on a large scale in India. If the tariff increases, less goods will go to America and trade in India will be affected and jobs will be lost."
He estimates that if America continues with the 50 percent tariff, up to 50 lakh jobs can be lost in India.
Friendship with india
Foreign policy experts believe that decisions between two countries are not taken only from an economic perspective, but geopolitics, diplomacy and national interests are also given priority.
Economist Mitali Nikor of Nikor Associates believes that India should not take a decision under Trump's pressure.
On the other hand, Ajay Srivastava believes that India cannot spoil relations with Russia under Trump's pressure.
He says, "History tells us that Russia has helped India instead of America in times of crisis."
In the 1971 Indo-Pakistani War, Russia supported India with military weapons, diplomatic support as well as supported India in the United Nations. On the other hand, America openly supported Pakistan and sent its 7th fleet against India in the Indian Ocean.
After the nuclear test in 1998, Russia continued to supply weapons to India. This was a time when Western countries were imposing various sanctions on India.
Ajay Srivastava says, "There is also a question of trust between India and America. It is not necessary that if India stops buying oil from Russia, America will remove its 25 percent additional tariff."
He says, "In the year 2024, China bought oil worth $ 62.6 billion from Russia and India bought oil worth $ 52.7 billion. Despite this, such a tariff was not imposed on China, because the issue is not just about oil."
Srivastava says, "One reason for the 50 percent tariff imposed on Brazil is the ongoing lawsuits against former President Bolsonaro, and the other reason is also X (formerly Twitter)."
He says, "Brazil asks X to remove content, which America does not like. Trump is imposing any condition. Therefore, it is not necessary that America will not impose tariff on India for not buying oil from Russia."
Mitali Nikor says, "Right now there is the issue of Russian oil, tomorrow America can put pressure on India regarding BRICS, day after tomorrow it can make the trade deal a condition. In such a situation, India cannot accept the one-sided conditions of America."
'Need to strike a balance'
From the beginning, India's foreign policy has been non-aligned. India has not been a part of any of the two or more major military or political groups in international politics. India has maintained an independent and impartial stance.
Ajay Srivastava says, "The question is how long will India keep getting cheap oil from Russia? Oil is a very temporary matter. Russia and India are old friends in the field of defense. Not buying oil will not spoil our relations. India needs to maintain a balance between Russia and America."
Robindra Sachdev also says the same thing. He believes that this tariff war will not last long.
Sachdev says, "Not only is America important for India, but America also cannot do anything without India. China is the biggest challenge for it, for which it needs India's support."
Mitali Nikor says, "These are difficult times and India has to remain strong in this. Many Republicans in America are questioning Trump about what he is doing. What is happening internally there is good for India."
She says, "We should have back channel talks with those people in America who are speaking in favour of India, so that this situation can be defused."
Lessons for India
About 18 percent of India's total exports go to the US.
Mitali Nikor says, "India will have to work on a diversification strategy. We cannot rely so much on one country. We will have to strengthen trade relations with big countries like Europe, Japan, Australia and UAE for export."
She says, "India sends about 40 percent of its shrimps, i.e. 25 thousand crores worth, to the US every year, but now India has signed a free trade deal with the UK, after which India will be able to send its shrimps to the UK. There is a good demand there too. In this way, India can find other markets for its goods."
She says, "India needs to strengthen its traders so that they can find new markets. The government should also support small traders so that they can strengthen Make in India, which will reduce our dependence on foreign countries."
However, Rabindra Sachdev believes that it is not easy to shift one's export market.
He says, "India can diversify its exports to some extent, but that is not so easy. America is a very big market, it is difficult to find such a market in the world."
He says, "India needs reforms internally as well. India should make six days a week work compulsory for one year. If we do this, our GDP can increase by up to two percent."
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