In the face of potential penalties threatened by President Donald Trump, India has affirmed its decision to continue buying cheap oil from Russia. This development surfaces amidst ongoing India-U.S. talks concerning a bilateral trade agreement.

What Happened: According to a report, Indian officials have expressed their determination to persist with their oil imports from Russia, despite the looming threat of penalties from President Trump.

The U.S. President had recently announced a new series of tariffs, incorporating an unspecified penalty on India should it not halt its imports of Russian crude oil.

Two high-ranking Indian officials told The New York Times on Saturday that there has been no alteration in their policy. One of them stated that the government has not directed oil companies to cut down imports from Russia. The precise nature of the potential penalty from the U.S. is yet to be clarified.

India’s purchases of Russian oil have seen a significant surge since the war in Ukraine commenced. Russia now supplies over a third of India’s oil imports, positioning India as the second largest importer of Russian oil after China.

Also Read: Trump Warns India Of 25% Tariffs As Trade Talks Stall Ahead Of August 1 Deadline

There is speculation that Trump’s emphasis on India’s procurement of Russian oil could be a strategic move in the ongoing trade agreement negotiations between the two countries.

Why It Matters: India’s decision to continue importing Russian oil despite U.S. threats of penalties underscores the country’s strategic and economic considerations. With Russia accounting for over a third of India’s oil imports, the country’s energy security is closely tied to its relationship with Russia.

This move also indicates India’s determination to maintain its foreign policy independence, even in the face of potential economic sanctions.

The ongoing trade agreement negotiations between India and the U.S. add another layer of complexity to the situation.

If President Trump’s focus on India’s purchase of Russian oil is indeed a negotiating tactic, it could potentially impact the outcome of these discussions. However, with India standing firm on its decision, the ball is now in the U.S.’s court to respond.

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