India Reaffirms Its Stance on Oil Imports, Disregarding External Pressures

5 Sept 2025 18:12

In what seems like a recurring theme, India has once again asserted its position on oil imports, demonstrating its commitment to prioritizing national interests over external influences.

The South Asian powerhouse has emphatically stated that it will persist in purchasing oil from the most economically advantageous sources, brushing aside international pressures and the recently imposed 50% import tariff by the United States administration.

During an interview with a prominent news channel, Finance Minister Nirmala Sitharaman emphasized India's pragmatic approach to energy procurement. She stated, "Our decision-making process is guided by what best serves our national interests. We will undoubtedly continue to make purchases that align with this principle."

This resolute stance comes amid accusations from Washington that India's energy purchases are indirectly supporting geopolitical conflicts.

Since early 2022, India has emerged as a significant buyer of seaborne crude from certain suppliers, capitalizing on substantial price reductions. While some Western nations have shifted away from these sources, India's oil imports have seen a marked increase.

New Delhi maintains that its continued purchases contribute to market stability. However, this perspective seems to be at odds with the current U.S. administration's economic outlook.

Diplomatic Tensions and Trade Implications

In a recent interview with a financial news network, U.S. Commerce Secretary Howard Lutnick expressed criticism of India's oil procurement strategies and called for a reevaluation of trade relations. Lutnick remarked, "There's a choice to be made here – support your largest consumer base, or face significant tariffs. We'll see how long this situation persists." He suggested that India might soon reconsider its position and seek to reopen dialogues with Washington.

India, however, remains steadfast. Sitharaman elucidated that energy expenditure constitutes a substantial portion of the country's foreign exchange outflow. She emphasized, "Our procurement decisions, regardless of the source, are based on what best suits our requirements – be it pricing, logistics, or other factors." In the fiscal year ending March 2025, crude oil and refined fuel purchases accounted for approximately a quarter of India's total imports.

Concurrently, trade relations between India and the U.S. have hit a rough patch. Negotiations aimed at alleviating American tariffs on Indian exports have stalled. A scheduled visit by U.S. trade officials to New Delhi was called off last month, with no subsequent meetings or discussions taking place since then.

As economic talks faltered, diplomatic gestures took center stage. Indian Prime Minister Narendra Modi participated in a summit in Tianjin this week, hosted by Chinese President Xi Jinping, with the Russian President also in attendance.

The three leaders were captured by media cameras standing together, with Modi and his Russian counterpart seen walking hand-in-hand towards their Chinese host.

Global Reactions and Geopolitical Implications

The U.S. administration responded to these developments through social media, expressing disappointment and suggesting a realignment of global alliances. The post was accompanied by an image from the summit. In a press briefing, the U.S. President also conveyed his dismay regarding certain diplomatic developments but downplayed concerns about evolving international partnerships.

India's foreign ministry chose not to comment on these remarks, maintaining its characteristic diplomatic restraint. Modi, too, refrained from directly addressing the statements, letting his presence at the Tianjin meeting speak for itself.

Some analysts interpreted the Tianjin gathering as a demonstration of solidarity among nations seeking to chart an independent course in global affairs. The summit included representatives from various countries, with Modi's participation, following recent tensions with the U.S. administration, being viewed by some as a strategic message.

The U.S. administration, which had previously sought to cultivate New Delhi as a key ally, now finds itself at odds with India. The American response to India's energy policies, coupled with increased tariffs and diplomatic silence, has contributed to a growing divide between the two nations.