US Treasury Secretary Scott Bessent has indicated that India’s 25% tariff on Russian crude oil purchases could be lifted. This move comes amid a shift in India’s energy policy and a reduction in Russian oil purchases, which is expected to bring significant economic benefits to India.
US Tariff Reduction: US President Donald Trump’s new administration is preparing to give India a major economic gift. In Davos, US Treasury Secretary Scott Bessant stated that the 25% tariff imposed on India’s purchases of Russian crude oil has been successful, paving the way for its removal. He described the move as a “major success” and indicated that the removal of the tariff will bring economic benefits to India. This statement comes at a time when India is reducing its purchases of Russian oil and diversifying its energy sources.
Why has the path been opened for the removal of the tariff?
Bessant stated that Indian refineries have significantly declined in their purchases of Russian oil since the tariff was imposed. He called this a major success and said that the path has now been paved for the removal of the tariff. His statement indicates that the US hopes that India has made substantial changes through its actions. This statement has led to growing speculation that the Trump administration may soon announce the removal of the 25% tariff.
India likely to benefit by ₹50,000 crore
If the US officially lifts the 25% tariff, India is expected to benefit by approximately $5 billion, or over ₹50,000 crore. India currently relies heavily on Russia for its energy needs, and the removal of tariffs will reduce costs for Indian refineries. This could also reduce pressure on fuel prices and positively impact foreign exchange reserves.
India’s “India First” energy policy will remain strong.
India has made it clear that it will not backtrack on its India First energy policy. Foreign Ministry spokesperson Randhir Jaiswal stated that India’s priority is to ensure affordable and reliable energy for its 1.4 billion people. The country makes decisions based on its national interest and energy price stability. Meanwhile, reports indicate that India increased oil purchases from Russia in November, but this figure decreased to 929,000 barrels per day in December. Indian refineries have resumed purchasing oil from the Middle East and Africa.
Scott Bessant’s statement clearly indicates that US-India relations could see increased cooperation under the new government, and India could benefit significantly economically in the energy sector. This move will also strengthen India’s strategic independence and energy security.
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