All Things Policy Trading with Trump: How Should India Respond?
Jul 28, 2025
Anupam Manur, an economics professor at the Takshashila Institution, dives into the shifting landscape of U.S. trade policy under Trump. He discusses the potential secondary tariffs on India for importing Russian oil and their implications for India's economy. The conversation highlights India's rising reliance on Russian oil and the challenges in negotiating trade deals with the U.S. amidst fluctuating tariffs. Manur also draws parallels with trade agreements signed by other nations, speculating on how India can maneuver through these turbulent waters.
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US Uses Secondary Tariffs Strategically
- The US uses secondary tariffs as a coercive weapon, targeting countries like India trading with Russia.
- Tariffs threaten to choke Russia's economic lifelines indirectly through trade partners.
India's Growing Dependence on Russian Oil
- India expanded oil imports from Russia from 2% pre-war to about 35-40% after war sanctions.
- Shifting away from Russian oil abruptly would be costly despite diversification efforts.
Advocate Patience in Trade Negotiations
- India should not rush to sign a trade deal amid unpredictable US tariffs.
- Taking time aligns with India's strategy to avoid hasty concessions under uncertain conditions.