As the deadline for US President Donald Trump’s punitive tariffs on India approaches, US Treasury Secretary Scott Bessent has accused India of “profiteering” by reselling Russian oil for significant profits during the Ukraine conflict. In a CNBC interview, Bessent defended the decision to impose a 50% tariff on Indian goods—comprising a 25% base tariff and an additional 25% penalty for India’s oil trade with Russia—while sparing China from similar measures.

Bessent highlighted that India’s oil imports from Russia surged from less than 1% before the Ukraine war to 42% currently, generating an estimated $16 billion in excess profits for some of India’s wealthiest families. “This Indian arbitrage—buying cheap Russian oil and reselling it—has sprung up during the war, which is unacceptable,” he stated. In contrast, he noted that China’s Russian oil imports, which rose modestly from 13% to 16% since the conflict began, reflect a more diversified import strategy, justifying the lack of penalties.

The tariffs, set to take effect by the end of August 2025, have strained US-India relations, with India’s Foreign Ministry calling the measures “unjustified and unreasonable.” Russia has also criticized the US for issuing “illegal threats” against its trading partners. In a move seen as a conciliatory gesture, India temporarily suspended an 11% import duty on cotton until September 30, signaling willingness to address US agricultural concerns.

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Amid these tensions, Chinese Foreign Minister Wang Yi met with Indian External Affairs Minister S. Jaishankar in New Delhi on Monday, advocating for expanded India-China cooperation to counter “overwhelming bullying” in global trade. Indian Prime Minister Narendra Modi, addressing the tariff issue during his Independence Day speech last week, emphasized India’s resolve to protect its economic interests, particularly for farmers, despite the looming trade penalties.

As the tariff deadline nears, the contrasting treatment of India and China underscores the complex interplay of geopolitics and trade, with significant implications for US-India relations and global oil markets.

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