India’s growing dependence on discounted Russian oil has been cast by Washington as a geopolitical liability, but history tells a different story. From Soviet-era concessions in the 1960s to today’s crude shipments at knockdown prices, Moscow has long used “discount diplomacy” to cement ties with New Delhi. Far from being an aberration born of the Ukraine war, these bargains are part of a decades-old strategic pattern one that President Trump’s new tariffs may, ironically, end up reinforcing rather than dismantling.
The latest clash between New Delhi and Washington, sparked by the Trump administration’s imposition of secondary tariffs on India for importing Russian crude, has once again brought India’s strategic calculus under scrutiny. At the center of this dispute lies not just energy security, but also the legacy of a time-tested partnership between India and Russia one that has historically been built, quite literally, on “discounts.”
Washington’s rationale is straightforward: every barrel of Russian crude India imports strengthens Moscow’s war chest in Ukraine. New Delhi, however, insists its decisions are guided by energy affordability and national interest, not geopolitics. By rejecting Western sanctions and continuing to purchase Russian oil, India has positioned itself as both a beneficiary of Moscow’s economic isolation and as an indispensable stabilizer of global oil markets.
For Trump, this is a convenient wedge. His tariffs are meant to showcase toughness on Russia while simultaneously punishing India for pursuing an independent energy strategy. Yet, the irony is striking: American companies themselves are seeking investment avenues in Russia’s energy sector, even as Trump justifies penalizing Indian refiners.
India’s embrace of discounted Russian crude since 2022 has been painted as opportunistic. But this is not a new story. As far back as the 1960s, the Soviet Union offered India oil at a 10–20% discount, recognizing both India’s price-sensitive market and Moscow’s strategic interest in cultivating ties with New Delhi.
The pattern has persisted. Following sanctions and the $60-per-barrel price cap, Russian crude became available at $15–20 discounts, saving India an estimated $12.6 billion while enabling it to import over $140 billion worth of oil from 2022 onwards. For India’s refiners, which now account for nearly 40% of Russia’s crude exports, the logic is irresistible: even marginal discounts justify sustained purchases, as no other supplier can match such volumes consistently.
Recent Ukrainian strikes on Russian energy facilities briefly narrowed discounts to $1–2 per barrel, causing India’s imports to dip. But with Trump’s tariffs re-entering the picture, discounts are rising again, and refiners are expected to increase imports by 10–20% in the coming months. History, in other words, is repeating itself.
Beyond oil, the India-Russia relationship remains deeply embedded in defence and diplomacy. Over 60% of India’s military inventory originates from Russia. Although Russia’s share of defence imports has declined from 62% in 2017 to 45% in 2022, ongoing talks under the India-Russia Inter-Governmental Commission (IRIGC) are set to reinvigorate joint projects in defence production, Arctic cooperation, and advanced technologies.
The $68.7 billion trade volume in 2024 a nearly sixfold rise since pre-pandemic levels is not merely about energy. Non-oil trade, while smaller, is steadily increasing, and Moscow remains one of India’s few partners willing to back reforms in global multilateral platforms like the UN, SCO, BRICS, and the G20.
Trump’s framing of the Ukraine war as “Modi’s war” exemplifies both the transactional and unpredictable nature of his foreign policy. For India, such rhetoric is more than irritating it underscores the need to insulate national policy from Washington’s oscillations.
Secondary tariffs may complicate India’s short-term trade flows, but they are unlikely to dismantle the structural logic of discounted Russian oil. In fact, they may accelerate New Delhi’s pivot toward Moscow, as policymakers look to deepen defence and technology cooperation in order to offset American unpredictability.
India’s posture is neither pro-Russia nor anti-West. Rather, it is best understood as “non-West” a deliberate positioning that maximizes room for manoeuvre. While Russia aligns more openly with China in its anti-West framework, New Delhi is careful to maintain equidistance, engaging with the US in strategic sectors while refusing to sever historic ties with Moscow.
The Trump tariffs, therefore, do not fundamentally change India’s strategy. They reinforce it. By highlighting Washington’s inconsistencies, they give New Delhi greater justification to pursue an independent path, one that relies on Russian discounts for stability and on diversified diplomacy for resilience.
The history of Russian “discounts” from the 1960s to today tells us something important: these concessions are not acts of charity, but tools of strategy. For Moscow, they secure political goodwill. For India, they ensure economic stability. And for both, they anchor a relationship that can withstand external turbulence.
As Trump attempts to weaponize tariffs, he may end up achieving the opposite of his intentionnot isolating Russia, but further cementing India’s reliance on it. In the end, Moscow’s old playbook of offering discounts remains a powerful lever, ensuring that India’s partnership with Russia endures, regardless of who occupies the White House.