By Manjeev Singh Puri, Pritish Kumar Acharya, Gopal K. Sarangi

India, as the third-largest energy-consuming country, now faces a formidable challenge following the imposition of a steep 50% tariff by the US on its exports. This tariff is structured as a composite measure, comprising a 25% reciprocal tariff and an additional 25% punitive surcharge over and above existing duties. Such unilateral action risks distorting the global trade order and disrupting existing energy trade equations, potentially escalating volatility and deepening instability in energy markets.

It gets pronounced in a juncture where the global climate governance is throttled by divisive and disruptive domestic climate actions by a few large emitters. Besides, this measure directly challenges India’s foreign trade policy, diplomatic positions, and significantly undermines India’s energy ambitions. Beyond an economic punishment, this strategic move by the US exemplifies authoritarian trade tactics aimed at stalling a key trading partner’s developmental trajectory.

In a way, the US, by imposing such a penalty, tactically puts pressure to make a business sense for its own oil exports. In this disrupted landscape, India must convert adversity into a strategic opportunity, advancing its energy and climate leadership through decisive, forward-looking actions. 

According to NITI Aayog, India’s primary energy supply is dominated by coal with a share of nearly 60%, followed by oil (28%), and gas (7%), as of 2023-24. Oil remains critical for the nation’s transport, residential, and commercial sectors, thereby establishing its relevance in the energy portfolio. The US imposed tariffs on India, citing concerns over trade imbalances and alleging that India’s continued purchases of discounted oil from Russia are not only indirectly helping to "fuel" Moscow’s........

© ABP Live