Updated 9:30 p.m. with ministry of foreign affairs statement; an earlier version of this article was published at 9:12 p.m.
US president Donald Trump on 6 August, Wednesday, slapped an additional 25 per cent tariff on goods coming from India as a penalty for New Delhi’s continued purchase of Russian oil, a move that is likely to hit sectors such as textiles, marine and leather exports hard.
Trump signed an executive order, ‘Addressing Threats to the US by the Government of the Russian Federation’, imposing the additional tariff over an above the 25 per cent levy which comes into effect from 7 August, Thursday.
After this order, the total tariff on Indian goods, barring a small exemption list, will be 50 per cent.
“The ad valorem duty imposed… shall be in addition to any other duties, fees, taxes, exactions, and charges applicable to such imports…,” the order said.
While the initial duty becomes effective on 7 August, the additional levy will come into effect after 21 days, or on 27 August.
“I find that the Government of India is currently directly or indirectly importing Russian Federation oil. Accordingly, and as consistent with applicable law, articles of India imported into the customs territory of the United States shall be subject to an additional ad valorem rate of duty of 25 per cent,” it said.
India buys about 88 per cent of its crude oil, which is converted into fuels like petrol and diesel, from overseas. Russian oil made up for hardly 0.2 per cent of all the crude oil that India imported until 2021. After Moscow invaded Ukraine, Russian oil was available at a discount to international benchmarks due to western sanctions and was quickly lapped up by Indian refiners. Russia is now India’s largest oil supplier.