India-Russia Trade Targets $100B Amid US Tariffs
New Delhi2 hours agoAuthor: Surajbhan Sharma
As India and Russia set eyes on taking their bilateral trade to $100 billion by 2030 amid geopolitical shifts, and destabilising effect of Trump tariffs, we explore how the two sides have advanced in commerce while navigating the challenges since the war in Ukraine in 2022.
This “strategic” push comes as both nations face mounting pressure from the US — Russia with backbreaking sanctions and New Delhi with a grueling 50% tariff — further cementing their shared desire for “steady partners” in an increasingly uncertain world.
Interestingly, the US recognition of a “growing” India-Russia trade isn’t without merit as far as trade data goes. But whether it helped fanned the Russian war machine in Ukraine, as Washington likes to believe, has been fiercely contested by New Delhi and is perhaps, rightly so.
Government data shows, bilateral trade between India and Russia saw a five-fold increase – from $13.12 billion in 2022 to $65.69 billion in 2024. On the other hand, bilateral trade between India and the US has fallen from $128.78 billion in 2022 to $118.2 billion in 2024.
Credit: Kamlesh Makwana
However, while India had a trade surplus with the US at $40 billion in 2024, it is the opposite in the case with Russia. India had a trade deficit of $57.14 billion with Russia in the same period.
During his most recent visit to Moscow, Indian External Affairs Minister S. Jaishankar called for deepening trade ties with Russia.
Speaking at the India-Russia Business forum, Jaishankar emphasised the critical need to dismantle existing trade bottlenecks and reduce non-tariff barriers to realise this goal.
Credit: Kamlesh Makwana
The weight of tariffs and search for alternatives
The urgency behind this trade acceleration is palpable, particularly in the context of the Trump administration’s aggressive trade policies.
The US has imposed a 25% tariff on Indian goods and has threatened to double it to 50% by August 27, a move that could impact India’s $85 billion in annual exports to the US.
India has fiercely defended its right to secure energy from the most affordable sources, labeling the US tariffs as “unreasonable.” The ability to purchase Russian oil at a discount has become a crucial tool for New Delhi in managing domestic inflation, a paramount concern for any government.
This economic imperative, combined with a historical alignment, has seen India steadily edge away from the US in recent times.
Credit: Kamlesh Makwana
Trade figures and imbalance challenge
Bilateral trade between India and Russia reached a record $68.7 billion for the year ending March 2025. While this figure represents significant growth, it also reveals a substantial imbalance of the $59 billion deficit.
Major Indian exports to Russia include nuclear reactors, electronic goods, organic chemicals, and pharmaceuticals. For instance, from April-October FY25, India’s exports to Russia stood at$3.04 billion, with nuclear reactors alone accounting for $829.43 million.
Conversely, India’s imports from Russia are heavily dominated by energy. In 2023-24, India imported 78 commodities from Russia, with petroleum crude making up a massive $54.5 billion of the total $61.43 billion in imports.
Other significant imports include fertilizers, animal or vegetable fats and oils, and precious stones. From April-October FY25, fuels and oils accounted for $35.10 billion of the$38.85 billion in imports from Russia.
Credit: Kamlesh Makwana
Diversification and deepening collaboration
Recognizing this trade imbalance, both Jaishankar and Russian Foreign Minister Sergei Lavrov have emphasized the need to diversify trade. Plans are underway to significantly increase India’s exports of pharmaceuticals, agriculture, and textiles to Russia. This diversification is seen as crucial for achieving the $100 billion target and fostering a more balanced trade relationship.
Beyond traditional goods, new avenues for cooperation are emerging. Jaishankar suggested encouraging more joint ventures between Indian and Russian companies, advocating for more frequent meetings to iron out logistical challenges, including payment systems.
Lavrov highlighted the flourishing cooperation in the hydrocarbon sector and reaffirmed commitment to joint energy production projects in the Russian Far East and the Russian Arctic shelf.
A particularly interesting development is the plan to send Indian workers with skills in IT, construction, and engineering to Russia to help address its labor shortages. This initiative reflects a broader commitment to leveraging each other’s strengths for mutual economic benefit.
Credit: Kamlesh Makwana
Geopolitical undercurrents and strategic autonomy
The intensifying India-Russia economic partnership cannot be viewed in isolation from the broader geopolitical context. Western governments have imposed sanctions on Moscow and tariffs on India following the conflict in Ukraine, arguing that India’s increased imports are helping to finance Russia’s war efforts.
New Delhi has consistently pushed back against this narrative, asserting its sovereign right to make independent trade decisions and pointing out that the US and European Union also continue to engage in substantial trade with Russia.
Although, it was the US administration who initially requested India earlier to purchase oil from Russia to help stabilize global oil markets.
For India, Russia has historically been a dependable partner, offering support at the United Nations, playing a pivotal role in building India’s military capabilities, and allowing India the strategic autonomy to engage with the West on its own terms.
This deep-rooted strategic alignment, rather than being undermined by US pressure, appears to be strengthening. As Daniel Balazs, a research fellow at S. Rajaratnam School of International Studies, noted, the Trump administration’s tariff threats might “even act as a catalyst,” pushing New Delhi further into Moscow’s embrace and potentially paving the way for a trilateral meeting with China, an initiative long sought by Moscow.
Indeed, Russian embassy officials in New Delhi recently affirmed that oil shipments to India would continue irrespective of US pressure, reiterating Moscow’s hope for a trilateral meeting with India and China.
While India’s imports of Russian oil have surged dramatically from 50,000 barrels per day (bpd) in 2020 to 1.6 million bpd in the first half of this year, it still trails China’s 2 million bpd imports.
The US Treasury Secretary Scott Bessent’s suggestion that Beijing’s imports are “less egregious” due to China being a major buyer before the Ukraine conflict has only amplified India’s perception of a double standard in Washington’s approach.
Source: www.bhaskarenglish.in