India faces Trump tariff heat as China gets breather

India faces potential US tariff pressure as China receives extended relief under their ongoing trade truce, according to the Global Trade Research Initiative (GTRI). The Busan Agreement, originally set to expire on November 10, has been extended until January 10, 2027, preventing further bilateral tariffs during this period. However, this development may leave India more exposed to potential US tariffs on Russian oil purchases, as China's trade arrangement with Washington provides temporary protection for Beijing, according to GTRI founder Ajay Srivastava.

New Delhi, along with China, are significant purchasers of Russian oil, but Beijing's exemption under the Busan Agreement suggests it will not face the same level of tariff threat as India. While the legislation allows for up to 100% tariffs on Russian energy buyers, it remains unclear if the Trump administration will exercise these powers.

Srivastava argues that Washington could leverage the threat of steep oil tariffs as leverage in its trade negotiations with India, pressing for a deeply unequal Bilateral Trade Agreement (BTA) in exchange for a lower tariff rate. GTRI warns India not to trade its energy security for temporary tariff relief or sign unequal trade deals, emphasizing that the US has a history of imposing new tariffs even after signing trade agreements with key allies.