Donald Trump considers financial and economic pressure as the main tool to influence Russia, particularly by restricting Russian oil exports. Recent data shows India and China together account for about 93% of Russia’s oil exports, with India buying 42% and China 51%.
August 8 marks the deadline for the new US tariffs. The key question: will the Trump administration introduce additional tariffs against China and India, as previously pledged? Experts note the existing 25% tariffs on Indian goods, though immediate new actions are not anticipated.
Tariff increases are part of broader geopolitical competition. Earlier forecasts suggested that without change, China and India would become the world’s leading economies by 2050, with the US slipping to third place. Since 2017, Trump has pushed for higher tariffs and is now following a course of disrupting the world trade order, bypassing WTO rules.
Raising tariffs up to 50% has triggered negative reactions from partner countries and could create preconditions for alliance-building against the US as well as dedollarization trends. The US is also forming trade alliances with the EU, UK, and Japan to preserve its market advantages.
Higher tariffs are expected to cost the US economy: forecasts indicate a GDP reduction of $108 billion and an average additional cost of over $800 per US household. India’s economy is highly dependent on exports to the US ($91 billion in 2022); for China, this market is likewise crucial. The EU may find itself at a disadvantage in the new global economic architecture.
The US initiative to raise tariffs on countries buying Russian energy sets a precedent that may reduce Russia’s export revenues, which is significant given the growing Russian budget deficit.
