Why Is US Punishing India, But Not China, For Buying Russian Oil? | Explained

New Delhi: The US president Donald Trump is increasing pressure on countries that continue to buy oil from Russia. These steps are part of efforts to end the ongoing Russia-Ukraine war, now in its fourth year. While India has been hit with a 25 percent extra tariff (making it 50 percent total), China - the largest buyer of Russian oil - has not faced the same punishment.

This difference has raised many questions: Why is India being targeted while China is spared?

India and China: Who’s Buying More Russian Oil?

In 2024, China bought a record 109 million tonnes of Russian oil, which was about 20 percent of its total energy imports. India, in comparison, imported 88 million tonnes. This shows that China is buying more, and in larger volumes.

New US Law Targets Russian Oil Trade

Both Republican and Democrat lawmakers in the US have supported a new bill called the Sanctioning Russia Act of 2025. This law would allow President Trump to impose tariffs up to 500 percent on countries buying Russian oil and gas. While the bill is ready, Trump’s final approval is still pending.

Trump’s Soft Stance on China: Trade Talks and Rare Earths

When asked about punishing China, Trump said he didn’t need to think about it 'right now', possibly hinting that action may come later. Experts believe Trump is delaying action on China because of important trade talks, especially those related to rare earth minerals.

Rare earths are 17 key minerals used in clean energy, electronics, and military products. China dominates the world’s rare earth supply, and the US depends heavily on it. This makes trade with China sensitive.

Timing Around US Holidays Also Matters

Trump is also believed to be avoiding tough tariffs on China because US retailers are preparing for Christmas. Imposing tariffs now would make Chinese goods more expensive and hurt American shoppers. To cool down tensions, the US even eased some export bans on advanced chips, letting Nvidia sell to China in exchange for a 15 percent sales fee to the US government.

What the US Is Saying About India

US officials have accused India of making profits by buying cheap Russian oil and then selling it after refining. Before the Ukraine war, India bought less than 1 percent of its oil from Russia. Today, that number has jumped to 42 percent, according to US Treasury Secretary Scott Bessent. He called this the 'Indian arbitrage' and said it brought USD16 billion in extra profits to some of India’s richest families.

Other US officials, including Peter Navarro and Stephen Miller, have said India is helping fund Russia’s war. Navarro even said India's actions are 'not acceptable.'

China’s Response and Global Concerns

China, meanwhile, defended its trade with Russia, saying it follows international law. China also warned that sanctions could increase global oil prices, especially since China refines Russian oil and sells it worldwide.

US Secretary of State Marco Rubio agreed, saying punishing China could raise global energy costs.

The Bigger Picture: Trade and Inflation Fears

Trump’s team is likely avoiding harsh moves against China because both economies are closely linked. China’s economy is slowing, and the US doesn’t want to cause more problems — or increase inflation at home.

In fact, the US trade deficit with China in 2024 was USD295.4 billion, and China is still America’s biggest goods supplier. Any tariff spike could hurt both sides.

Trade Truce Holding for Now

In May, the US and China agreed to pause their trade war for 90 days, avoiding further damage. While past tariffs were as high as 145 percent, they’ve now been lowered to 30 percent for Chinese goods and 10 percent for US exports. China also agreed to restart some rare earth exports.

Why the Double Standard?

The US is targeting India over Russian oil, while sparing China - not because China buys less, but because China is more powerful economically and politically. With rare earths, trade balance, and inflation at stake, Trump is choosing caution with China, while India faces the heat for its growing energy ties with Russia.