India has to be smart about its trade with the United States. Here’s why
Tariffs are like extra taxes. US President Trump has threatened to put a 25% tax on countries that trade with Iran. He has said similar things before, like with Venezuela, but didn’t always follow through. Still, India should be careful because Trump often does what he wants.
India already pays extra for Russian oil. Since last August, India has had to pay a 25% penalty for buying oil from Russia. That feels unfair because other countries like China and Turkiye buy even more. But at least India saved a lot of money overall — about $26 billion between 2022 and 2025.
Trading with Iran doesn’t help much. India doesn’t sell much to Iran anymore — only about $56 million worth of goods last October, which is less than before. Things like rice and tea can be sold to other countries instead. India also invested in Iran’s Chabahar port, but that project hasn’t cost much, so it’s not a big worry.
Iran has serious problems at home. The Iranian government has been very harsh on protesters, with hundreds of people killed. The US says it wants to support democracy in Iran, and there’s even a law that allows it to punish Iran for hurting its people.
What if Iran’s government changes? Some leaders in other countries think Iran’s rulers might be close to losing power. If that happens, and a new, more democratic government comes in, it could actually be good for India.
The smart move for India: Instead of worrying too much about Iran, India should focus on making a trade deal with the US. That deal has been delayed for almost a year, and it would be much more helpful for India’s future. In short, India doesn’t gain much from Iran right now, but a strong trade deal with the U.S. could make a big difference.
Disclaimer
Views expressed above are the author’s own.
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