The political and economic fallout from the high-stakes meeting between US President Donald Trump and Russian President Vladimir Putin in Alaska is being watched closely in India. The summit, which is focused on a potential peace deal in Ukraine, could have direct consequences for India’s economy, particularly its trade relationship with the United States.
US Tariffs on Indian Goods Loom Large
The meeting comes amidst a tense period in India-US trade relations. In recent weeks, the Trump administration has imposed a total tariff of 50% on Indian exports, a rate significantly higher than for many other regional peers. This includes a 25% penalty on India’s crude oil purchases from Russia—a measure intended to pressure Russia into a ceasefire.
US officials have hinted that if the talks fail to produce “tangible progress” on a Ukraine peace deal, the tariff on India’s Russian oil purchases could be raised to 50% or more. This potential escalation, which could also include new duties on sectors like textiles and jewelry, threatens to put nearly 1% of India’s gross domestic product at risk, according to analysts.
In the days leading up to the summit, Trump claimed that India’s reduced intake of Russian oil, a result of the current tariffs, had “probably” encouraged Russia to come to the negotiating table. This comment signaled Washington’s clear intent to use economic pressure on New Delhi as part of its broader strategy to influence Moscow.
Defense Ties Remain Strong Amidst Tensions
Despite the economic friction, India’s Ministry of External Affairs spokesperson, Randhir Jaiswal, confirmed that defense cooperation with the US remains on track. “We are expecting a US Defense Policy Team to be in Delhi in mid-August,” Jaiswal stated on Thursday, highlighting that both nations are committed to a “robust” defense partnership. He also confirmed that the 21st edition of the annual joint military exercise, Yudh Abhyas, is expected to take place later this month in Alaska.
All Eyes on the Summit Outcome
With so much at stake, officials in New Delhi are waiting to see if a breakthrough between the two leaders can lead to a more lenient stance from the US. A positive outcome could alleviate the trade pressure, while a failure to reach an agreement could lead to a hardening of Washington’s position and further economic pain for India.
As the world watches to see which version of Trump will show up in Anchorage—the hardline critic of Russia or the one who has previously sought to ingratiate himself with Putin—the answer will have profound implications not just for Ukraine and Europe, but also for India’s economic future.