As India and the European Union move closer to concluding much anticipated “mother of all deals”, the United States has claimed that Europe is financing the “war” against itself by purchasing refined Russian
oil products from India.
US Treasury Secretary Scott Bessent contrasted Washington’s approach with what he described as Europe’s reluctance to impose similar penalties, arguing that European governments avoided tariffs to protect trade negotiations with India.
He said that Washington imposed 25% tariffs on New Delhi for buying Russian oil, but the Europeans signed a trade deal with New Delhi.
“We have put 25% tariffs on India for buying Russian oil. Guess what happened last week? The Europeans signed a trade deal with India. And just to be clear again, the Russian oil goes into India, the refined products come out, and the Europeans buy the refined products. They are financing the war against themselves,” he said in an interview with ABC News.
Bessent further said the Trump administration had taken tougher steps than its European allies to pressure Russia to end the ongoing conflict with Ukraine. “Trump has worked to negotiate a settlement on the Russia-Ukraine conflict”, Bessent said, adding that the US has made much bigger sacrifices than the Europeans.
His remarks came days after he claimed that its tariff measures played a key role in sharply reducing India’s purchases of Russian oil.
Bessant said that Washington’s decision to impose tariffs on India for buying Russian crude had led to a “collapse” in Indian refinery purchases.
“We put 25% tariffs on India for buying Russian oil, and the Indian purchases by their refineries of Russian oil have collapsed. So that is a success,” Bessent said in an interview with Politico.
According to Bessent, Russian oil accounted for just 2%–3% of India’s total oil imports before Moscow’s invasion of Ukraine, but the share rose to 18%–19% after the war began, allowing Indian refiners to earn “huge profits.”
He further signalled that the Trump administration may remove the additional 25% tariff imposed over its purchase of Russian oil.
“That is a success. The 25% Russian oil tariffs are still on. I would imagine there is a path to take them off now. So that’s a check and a huge success,” he said.
The Trump administration has imposed overall tariffs of up to 50 per cent on India, including the additional 25 per cent levy linked to India’s purchase of Russian oil.
India-EU Set To Ink ‘Mother Of All Deals’
Meanwhile, India and the European Union are expected to announce on January 27 the finalisation of an EU-India free trade agreement, with European Commission President Ursula von der Leyen calling it the “mother of all trade deals.” Von der Leyen is currently in India and was the chief guest at the 77th Republic Day celebrations in New Delhi.
Ahead of her visit, Von der Leyen described the proposed pact as a “historic” agreement that could reshape economic ties between India and the 27-nation European Union.
The European Union is currently India’s largest trading partner, with bilateral trade in goods valued at $135 billion in the 2023–24 financial year. Negotiations for the free trade agreement were first launched in 2007, stalled in 2013, and revived in 2022.
As part of the discussions, India is reportedly considering steep cuts in import duties on cars from the EU, potentially reducing tariffs to 40 per cent from as high as 110%.
Under the proposal, duties on a limited number of high-value imported vehicles would be lowered immediately and phased down further over time, easing market access for European automakers such as Volkswagen, Mercedes-Benz and BMW.
