U.S. President Donald Trump imposed an additional 25% tariff on Indian goods, citing New Delhi's continued imports of Russian oil in a move that sharply escalated tensions between the two nations after trade talks reached a deadlock.

Donald Trump has signed an order to impose tariffs imports into the U.S. from countries including China, Mexico and Canada.

Global Tariffs

The Trump administration has introduced a new 25% tariff on India as a response to the country's ongoing purchases of Russian oil. This action is part of a broader effort to pressure nations trading with Russia, with the goal of reducing Russia's oil revenue, which is a significant source of funding for its government and military actions in Ukraine.

Experts suggest that this secondary tariff is an unprecedented move in economic coercion. While the immediate effect may be a rise in global oil prices, analysts predict that increased production from other oil-producing nations could stabilize prices in the short term. The administration has not imposed similar tariffs on China, citing the larger volume of trade between the U.S. and China and the risk of escalating a broader trade conflict.

Trump imposes extra 25% tariff on India over Russian oil imports

We turn now to a new escalation in President Trump's trade war. The president has put the world on notice that any country still trading with Russia by this Friday will be hit with new tariffs. Today, India became the first country to be punished with an additional 25% tariff. Money Watch correspondent Kelly O'Grady now on the potential impacts on the global economy and your wallet. Special Envoy Steve Whitkoff met with Russian President Vladimir Putin for three hours today. A meeting described as highly productive, but not productive enough. Shortly after, the White House slapped an additional 25% tariff on India for one reason, because India buys oil from Russia. How innovative is this use of a secondary tariff to provide economic coercion? It's never been done before. Edward Fishman helped design sanctions against Russia when at the State Department. What's the goal here with the secondary tariff? The goal is to try to persuade the Indian government to crack down on refineries in India who are buying oil from Russia. Russia gets around international sanctions by transferring some oil from its tankers to other ships known as the Dark Fleet. Last year, 60 Minutes tracked some of those ships to India. Russia took in nearly $200 billion last year in oil revenue, money it uses to finance its more than three year long war in Ukraine. Oil is the lifeblood of Russia's economy. Without oil revenues, Russia would have a very difficult time running its government, let alone financing a massive military invasion of Ukraine. Russia exports about 5 million barrels of oil each day, roughly 40% of which is sold to India. If India stops buying that oil, it would have to come from somewhere else, meaning global oil prices could go up. That means Americans may end up paying more at the pump. Why do you think President Trump is willing to choke Russia's energy revenue when the Biden administration wasn't? In 2022, you had oil prices above $100 a barrel and inflation in the United States at a four decade high. It was hovering around 7%. Today, oil prices are in the 60s. You've got an incredibly loose oil market and you've got inflation that's relatively under control. Nice, clear explanation here, Kelly. So the U.S. putting tariffs on India to pressure Russia. Why not put tariffs on China? That is my big question, Maurice. Right. I mean, China is a bigger buyer of oil from Russia than India is. But I will also note we do a lot more trade with China than we do with India. And any escalation with a secondary tariff could reignite a trade war. And we're expecting oil prices here to rise in the short term. Why would that be? So it would only be in the short term because you would have potentially nations like Saudi Arabia, the ones in the OPEC, produce more, bring those prices down. You also might have the U.S. shale industry produce more. It's not profitable to produce oil at these low prices, but that spike in oil prices could provide the profitability to ramp up more production. All to say other countries would likely step in and those prices would come back down in the short term. OK, Kelly O'Grady, thanks so much.

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Trump imposes extra 25% tariff on India over Russian oil imports

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