US Tariffs and Indian Foreign Policy: Balancing Strategic Autonomy and Bilateral Ties
UPSC Relevance
Prelims: International Relations (Bilateral relations - India-US, India-Russia; Groupings - SCO, Quad), Indian Economy (International Trade, Free Trade Agreements - FTAs, Energy Security).
Mains: GS Paper 2 (Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests; Effect of policies and politics of developed and developing countries on India’s interests).
Key Highlights from the News
Main Event: The US imposed two major tariffs on India:
A 25% reciprocal tariff: following the failure of Free Trade Agreement (FTA) negotiations.
A 25% penal levy: because India continues to import Russian oil.
India's Response: India called the US action "unfair and irrational." The Prime Minister stated that agricultural interests would not be compromised.
Russian Oil Imports: After the Ukraine war, India significantly increased oil imports from Russia. This helped India save billions of dollars due to lower prices.
Comparison with Iran: In 2018, India stopped oil imports from Iran under US pressure. However, India resisting US pressure regarding Russia indicates a shift in policy.
Potential Solutions: The Trump-Putin summit might pave the way for a solution. Additionally, restarting FTA negotiations is a possibility.
Foreign Policy Implications:
These tariffs create cracks in the India-U.S. relationship.
At the same time, India is asserting its strategic autonomy. As part of this, India is strengthening its ties with Russia and China (via the SCO summit).
This poses challenges for the Quad summit hosted by India.
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