US Treasury Secretary Scott Bessent on Tuesday accused India of profiting from sharply increased purchases of Russian oil during the war in Ukraine, stating that Washington considers this situation unacceptable, UNN reports with reference to Reuters.
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In an interview with CNBC, Bessent stated that Russian oil now accounts for 42% of India's total oil purchases, compared to less than 1% before the war, and compared this to long-time buyer China, whose purchases of Russian oil increased from 13% to 16%.
"India is simply profiting. They are reselling. What I would call Indian arbitrage – buying cheap Russian oil, reselling it as a product that just appeared during the war – is unacceptable," he said.
This month, US President Donald Trump announced an additional 25% tariff on Indian goods as punishment for New Delhi's purchases of Russian oil, bringing the total additional duties announced since he took office to 50%.
Trump believes that Indian tariffs are increasing pressure on Kremlin leader Vladimir Putin to agree to work towards ending the war in Ukraine, but has not imposed similar tariffs on China for its purchases of Russian oil.
When asked about the Trump administration's failure to impose similar tariffs on China, Bessent replied that the situation was "completely different," given that Beijing was a long-time buyer and was not involved in the "arbitrage" that India was carrying out.
Relations between the US and India have been strained by Trump's tariffs after months of predictions by the US president and other officials that they were close to reaching an agreement with Indian Prime Minister Narendra Modi's government on a trade deal that would lower the tariff rate.
India on Tuesday temporarily suspended an 11% import duty on cotton until September 30, which is seen as a signal to Washington that New Delhi is ready to consider US concerns about agricultural tariffs.
This came after the sudden cancellation of a planned visit by US trade negotiators to New Delhi from August 25 to 29.