In a bold and controversial move, US President Donald Trump has signed an executive order imposing an additional 25% tariff on all Indian goods entering the United States doubling the overall tariff rate to a staggering 50%, one of the highest ever applied by Washington against a trade partner.

The decision is directly tied to India’s continued purchases of Russian crude oil, which the US claims undermines its foreign policy goals, especially in the context of the ongoing war in Ukraine.

The new tariff will take effect on 27 August, giving Indian exporters just three weeks to brace for impact.

Washington has increasingly warned its global allies and partners about maintaining commercial ties with Moscow, especially in energy. India, however, has stood firm, citing energy security and national interest as the basis of its oil purchases.

According to data from Kpler, a global commodities analytics firm, Russia currently supplies over 35% of India’s crude oil, making it New Delhi’s largest oil provider. India imported around 1.75 million barrels per day of Russian oil in the first half of this year alone.

The Trump administration has made it clear that this level of trade with Moscow is unacceptable. The executive order states that further penalties could follow for other countries that continue to import Russian oil. “We will recommend further actions to the President as needed,” the order says.

India’s Ministry of External Affairs issued a sharp response, calling the move “unfair, unjustified, and unreasonable.” It said that the Indian government has already made its position clear on energy imports and condemned the US measure as an infringement on its sovereign right to determine trade policy.

At a press conference, the ministry reiterated that the tariffs were counterproductive and damaging to bilateral relations.

India’s export community is now reeling. The Federation of Indian Export Organisations (FIEO) called the decision “extremely shocking,” warning that over 55% of Indian exports to the US will be affected. Products ranging from textiles and pharmaceuticals to auto parts and machinery are likely to be impacted.

A report by the Global Trade Research Initiative (GTRI) estimates that Indian exports to the US could drop by 40–50%, as higher tariffs make Indian goods unaffordable in American markets. Indian Rupee hit record low against U.S. Dollar recents report conclude.

“India should remain calm, avoid retaliation for at least six months, and recognise that meaningful trade negotiations with the US cannot proceed under threats or mistrust,”said Ajay Srivastava, a former Indian trade official and GTRI’s founder.

“You’re going to see a lot more, so much secondary sanctions,” Trump said, signaling that the US may extend punitive trade measures to other countries engaging with Russia including China and Turkey, Moscow’s other key energy partners.