‘India profiteering from Russian oil’: US Treasury Secretary says China’s case ‘entirely different’

US Treasury Secretary Scott Bessent has remarked that India is “profiteering” from discounted Russian crude, alleging that New Delhi has been engaging in arbitrage trading during the war in Ukraine. The US Treasury Secretary drew a distinction with China, calling Beijing’s position “entirely different” because of its longstanding role as a buyer of Russian energy.

The United States has already imposed a 25 per cent tariff on Indian goods, with an additional 25 per cent set to take effect on 27 August, bringing the total hike to 50 per cent.

Washington has framed the move as a direct response to India’s “increased purchases” of Russian oil during the Ukraine conflict.

What did the Treasury Secretary say on India?

In an interview with CNBC on Tuesday, Bessent claimed that India’s purchases of Russian oil had risen significantly, now accounting for 42 per cent of the country’s crude imports, compared with less than 1 per cent before the war.

“India is just profiteering. They are reselling,” Bessent said. “What I would call Indian arbitrage — buying cheap Russian oil, reselling it as product — has just sprung up during the war, which is unacceptable.”

US tariffs on China

Donald Trump signed an executive order extending a tariff truce with China for 90 days, moving the expiration date to 10 November 2025, thereby preventing a planned escalation of tariffs.

Current tariffs are capped at 30% on Chinese imports and 10% on US goods during this truce.

Without the extension, US tariffs on Chinese goods could have surged to 145%, with China’s retaliatory tariffs rising to 125%, approaching a trade embargo. Additionally, Trump imposed a 50% tariff on semi-finished copper and copper-intensive products effective from 1 August 2025.

The so-called “Liberation Day” tariffs were introduced on 2 April 2025, imposing a 34% duty on Chinese products atop earlier fentanyl tariffs. Following negotiations in Geneva in May 2025, both parties agreed to reduce tariffs to 30% for the US and 10% for China for 90 days, suspending more severe reciprocal tariffs.

However, Trump has not imposed any secondary tariff on Beijing citing 'Russian oil trade".

Why is China being treated differently?

According to Scott Bessent, Washington views China differently because it was already a major buyer of Russian energy before the war. Beijing’s imports from Moscow have only increased from 13 per cent to 16 per cent, which US officials consider less disruptive.

“The situation is completely different with China,” Bessent remarked, suggesting that India’s sharp increase in imports reflects a new trend rather than a continuation of past trade patterns.

What has been the US response?

President Donald Trump has introduced additional tariffs of up to 50 per cent on Indian goods, citing New Delhi’s purchases of Russian oil as a justification. He has argued that the tariffs are helping to increase pressure on Russian President Vladimir Putin to move towards negotiations over Ukraine.

By contrast, Trump has not imposed similar tariffs on China, a decision that has drawn attention to the differences in Washington’s approach towards the two countries.

How are India-US relations affected?

The issue has added to trade tensions between Washington and New Delhi. A potential US-India trade deal, which both governments had previously signalled was within reach, has yet to materialise.

India on Tuesday temporarily suspended its 11 per cent import duty on cotton until 30 September, a move seen as an effort to address some of Washington’s trade concerns, Reuters reported. As per Bloomberg, this move has been seen as a signal to Washington that New Delhi is willing to address concerns on agricultural tariffs.

The step came shortly after the planned visit of US trade negotiators to New Delhi, scheduled for 25–29 August, was cancelled.