While joint statements focused on market access and trade facilitation, Trump’s order lays bare the strategic quid pro quo shaping the agreement.
New Delhi, February 7, 2026: Hours after India and the United States released the fine print of their long-awaited Indo-US trade agreement, a White House executive order signed by President Donald Trump revealed a critical condition missing from the official deal text: India’s formal commitment to halt imports of Russian oil.
EXECUTIVE ORDER: https://www.whitehouse.gov/presidential-actions/2026/02/modifying-duties-to-address-threats-to-the-united-states-by-the-government-of-the-russian-federation-04b2/
While joint statements from New Delhi and Washington focused on tariff reductions, market access, and regulatory cooperation, Trump’s executive order makes clear that geopolitical alignment — especially on Russia — lies at the heart of the agreement. In effect, the deal hinges on a strategic trade-off: India exits Russian oil, and the US lifts a punitive 25% tariff on Indian exports.
Since Russia’s invasion of Ukraine in 2022, India had emerged as one of Moscow’s largest crude buyers, capitalising on steep discounts that helped New Delhi manage inflation, stabilise fuel prices, and reduce its import bill. By 2024–25, Russian crude accounted for nearly 40% of India’s total oil imports, a shift that drew increasing concern in Washington, which viewed the trade as undermining Western sanctions against Moscow.
That concern culminated in August 2025, when Trump imposed a 25% additional tariff on all Indian exports to the US, citing India’s continued engagement with Russian energy supplies. The tariff rattled Indian exporters, threatened supply chains, and risked undermining a bilateral trade relationship worth over $77 billion annually.
Friday’s executive order confirms that India has now formally pledged to stop both direct and indirect imports of Russian crude and petroleum products, triggering the rollback of the punitive duty. The tariff removal takes effect at 12:01 am EST on February 7, 2026, restoring normal market access for Indian goods.
The document also makes explicit that India will pivot its energy purchases toward the United States, significantly expanding imports of American oil and gas. This marks a major shift in India’s energy strategy and carries economic consequences, as US crude is generally costlier than discounted Russian supplies. Analysts warn the transition could increase India’s energy bill and place upward pressure on domestic fuel prices, complicating inflation management.
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Beyond energy, the order confirms that New Delhi and Washington have agreed to a 10-year framework to expand defence cooperation, deepening collaboration in military technology, cybersecurity, naval interoperability, and joint exercises. The defence pact adds a strategic dimension to what is being publicly framed as a commercial agreement.
Crucially, the executive order includes a strict monitoring clause, authorising US agencies to track whether India resumes purchasing Russian oil. If such imports restart, Washington reserves the right to reimpose the 25% tariff without further negotiation, effectively binding India’s future energy policy to continued US compliance.
What stands out is that none of these core geopolitical concessions appear explicitly in the official Indo-US trade agreement documents. By keeping the Russian oil commitment outside the public text, both governments appear to have sought to minimise political backlash, particularly in India, where relations with Moscow retain deep strategic and defence significance.
The executive order, however, lays bare the true structure of the deal: trade relief in exchange for strategic realignment.
In doing so, it signals one of India’s most consequential geopolitical shifts since the Ukraine war began, tilting New Delhi decisively closer to Washington while quietly loosening a long-standing energy partnership with Russia.
Behind the language of tariffs and market access lies a stark strategic bargain — and at its centre, the Russian oil clause left out of the fine print.
