Image Credit: X account @DrSJaishankar
India Flags Rising Trade Deficit with Russia
External Affairs Minister S. Jaishankar has raised concern over India’s widening trade deficit with Russia during his visit to Moscow. Speaking at the 26th India–Russia Intergovernmental Commission meeting, he said that while bilateral trade has expanded rapidly, the imbalance has become unsustainable.
Trade Growth and Deficit Figures
Bilateral trade has grown from $13 billion in 2021 to nearly $68 billion in 2024–25, making Russia one of India’s top trading partners. However, this sharp growth has also created a massive deficit. India’s trade gap with Russia has ballooned from $6.6 billion in 2021 to almost $58.9 billion in 2025, with energy imports being the main factor.
Oil Imports at the Core
India has been buying large volumes of Russian crude, attracted by discounted prices compared to global benchmarks. While these imports have supported India’s energy security, they have tilted the trade balance heavily in Russia’s favor. Payments have largely been routed through rupee-based settlement mechanisms, but the export side from India has not kept pace.
U.S. Tariff Pressure
Adding to the challenge, the United States has imposed 50% tariffs on Indian goods, citing India’s continued oil trade with Russia. These tariffs are among the highest levied against any Indian partner, increasing pressure on New Delhi to rethink its trade strategy and find new markets.
India’s Strategic Approach
Jaishankar emphasized that India must work with Russia to correct the imbalance by boosting exports in sectors like pharmaceuticals, machinery, agriculture, and services. He underlined the importance of reducing overdependence on any single commodity or partner, stressing that balanced trade is critical for long-term stability.
