US President Donald Trump announced the lifting of a 25% tariff on Indian goods, a decision made after a temporary trade agreement between Washington and New Delhi. The agreement requires India to cease its imports of Russian oil, which have been a point of contention since the outbreak of the Russian-Ukrainian war in 2022. India, which relies on imports for 90% of its oil needs, has been buying Russian oil at discounted prices, leading to tensions with the US.

Under an executive order signed by Trump, the tariff exemption came into effect immediately after India pledged to stop all direct or indirect purchases of Russian oil. In return, India committed to significantly increasing its buying of American energy products, aircraft, precious metals, technology products, and coal, with projected purchases amounting to nearly $500 billion over the next five years. The arrangement highlights the strengthening economic ties between the US and India while also revealing the pressures the US places on its allies regarding their economic interactions with Russia.

This move is seen as a strategy by the US to penalize countries that continue to engage in trade with Russia, as Washington is concerned that such transactions could finance Russia's military expenditures. The decision illustrates a broader geopolitical dynamic where countries like India must navigate their energy needs while balancing relations with the US and maintaining their economic interests, particularly in the context of the ongoing conflict in Ukraine.