Just when the world thought that U.S. -India relations were firmly on the friendship boat of the "Indo-Pacific Strategy", Trump threw a sanction order directly at New Delhi.
The Trump administration announced sanctions on Russian oil companies and LUKE oil, and for the first time explicitly included a “secondary sanctions” clause.
This means that any company that trades with these two Russian oil giants may be cut off from the US dollar settlement channel and impose high tariffs.
As soon as the news came out, international oil prices fluctuated in response, and companies from various countries responded even more quickly.
The day after the U.S. imposed secondary sanctions on Russian oil companies, India was exposed to preparations to drastically cut Russian oil imports, which is expected to fall to close to zero.
According to reports, India’s largest Russian crude buyer believes the industry is undergoing adjustments and plans to reduce or completely stop imports of Russian oil, including terminating previously signed long-term procurement agreements.
At present, many Indian companies have begun to increase their purchases of crude oil from the Middle East and Brazil in order to partially replace Russian oil supplies.
The decision was made by India to comply with the new U.S. sanctions on Russia and remove obstacles to the Indo-American trade deal.
Since the outbreak of the Russian-Ukrainian conflict in 2022, India has become the "pick-up king" of the global energy market with its neutral position.
The data show that India imports 1.7 million barrels of Russian discounted crude oil a day on average, not only to meet domestic demand, but also to sell Europe by refining, earning tens of billions of dollars in differences.
This kind of "left-hand turning right-hand" business practice makes the West curse and helpless at the same time.
However, Trump’s return changed this situation.
He directly sacrificed the tariff stick to India, soaring the tax rate to 50%. This move has accurately hit India's economic lifeline-India's refining industry relies on Russian supplies for about 40% of its crude oil. If it loses the US market, its energy transformation and foreign exchange reserves will encounter a double crisis.
Although the Indian Ministry of Foreign Affairs claims to insist on "decision-making based on national interests," its actions expose the real dilemma. It is estimated that this shift to reduce or terminate purchases of Russian oil may cost India an additional US$2.7 billion per year.
Modi's anger is almost written on his face.
Originally planned to meet Trump during the ASEAN Summit in Malaysia, he suddenly canceled his trip on the grounds of "celebrating Diwali". This almost "angry" move is regarded as a silent protest against the tough stance of the United States.
After all, Modi has always positioned India as a “global leadership force” but is now forced to give up strategic autonomy under tariff threats.
The deeper contradiction is that India has highly cooperated with the US "Indo-Pacific Strategy" in recent years, not only containing China on border issues, but also actively participating in the US-Japan-Australia-India Quadrilateral Security Dialogue.
However, Trump’s trade protectionism doesn’t eat the “alliance” at all.In his eyes, India is just “another country that makes America cheaper,” even because of its energy dependence on Russia.
In this game, Modi's trouble lies in the fact that if he continues to buy Russian oil, India will face a total blockade of the U.S. financial system; if he completely turns to high-priced Middle Eastern crude oil, domestic inflation may get out of control.
But this compromise is not unconditional — cancelling a meeting with Trump is just showing the domestic public a gesture of “hardness” to avoid being accused by the opposition as “American scam.”
India's concession also exposed the true status of the countries of the global south in the game between the United States and Russia.
Russia once regarded India as a “privileged strategic partner” but now looks at Indian refineries with a blind eye.
Moscow's disappointment can be imagined, but its countermeasures are limited-except for India, it is difficult for Russia to find an energy alternative market of the same size.
This asymmetric dependence completely destroyed the illusion of the “non-Western alliance.”
In contrast, China has alwaysined the stability of energy cooperation with Russia in the face of U.S. sanctions as well.Through diversified means such as RMB settlement and pipeline transportation, China has both guaranteed energy security and avoided the risk of secondary sanctions.
This strategic determination is in sharp contrast to India's "swing".
Trump’s “differential treatment” strategy is also worth playing.The same is true of Russia’s big energy buyers, but China has not been subjected to the same level of pressure by the United States.
Trump has openly said that he will not impose similar sanctions on China “to maintain the U.S.-China-friendly relationship” — a “differentiation” that clearly poured salt on India’s wounds.
There may be two considerations behind it: First, China's counter-measure capabilities far exceed India's, and head-on confrontation may hurt the US economy; Second, the United States still needs to cooperate with China on issues such as climate change and the DPRK nuclear issue.
This vibrating "smooth and hard" makes India clearly realize its true scores in the International Chess.
Based on the current situation, it is difficult for India to escape from the path of compromise with the United States in the short term.The U.S. is on the rise – if India does not comply, it may face a more severe financial blockade in the future.
But in the medium and long term, India may accelerate its energy diversification layout. For example, expand cooperation with Iran and Venezuela, promote the development of local renewable energy, and even reduce logistics costs with the help of the "International North-South Transport Corridor".
Moreover, the Modi administration may re-evaluate its "comprehensive pro-US" policy, seeking a more flexible balance between the US and Russia.
For Russia, short-term pressure does exist. The demand from China and India accounts for 90% of Russia's seaborne oil exports. If the two countries shrink at the same time, Russia will have to increase discounts to find new buyers.
But in the long run, Russia has built a counter-sanctions system through the means of "shadow fleet" and currency settlement, and its resilience has been verified many times in past sanctions.
Although the U.S. second-level sanctions are deterrent, there are loopholes at the implementation level.
For example, India may trade through third-party transactions, while China can continue trading through the RMB settlement system. Currently, more than 90% of China-Russia trade has been settled in its own currency, and this “de-dollarization” trend will weaken the power of sanctions.
If sanctions are long-term, Russia will accelerate its tilt towards other Asian markets. Emerging demand countries such as Indonesia and Vietnam may become new buyers, while the price war caused by Russian oil discounts may impact the stability of the OPEC+ alliance.
To put it bluntly, the core of this sanctions game is actually the contest of energy independent strategies among various countries. The most critical revelation is that if a country does not have sufficient comprehensive national strength support, the so-called "strategic autonomy" will eventually be just empty talk.
India always loves to benchmark against China, but it has repeatedly exposed its shortcomings under heavy pressure. It can be said that if you really give up buying Russian oil, you will lose your face, because it's hard to say whether Trump will "raise his hand" on tariffs as promised.
Per India should stop being stronger with China and first supplement the “internal work” – after all, the real rise, never need to look face to face.