President Trump has signaled that the United States and India are “pretty close” to reaching a trade deal, an unexpected development given the recent frictions and policy divergences between the two countries. India’s Ministry of Commerce declined to comment on Tuesday, November 11th, but Trump’s remarks suggest that tariff relief could be on the horizon. “The tariffs are very high on India because of Russian oil,” he told reporters, adding that these duties may soon be reduced as India scales back its imports of Russian crude.
The timing is particularly interesting. This week, India is leading a high-level trade delegation to Moscow, seeking to deepen economic engagement with the “non-Western bloc.” The mission is organized by the Federation of Indian Export Organisations, led by S.C. Ralhan, aiming to boost collaboration in the engineering and tools sectors. While the delegation is participating in the Moscow International Tool Expo, the Indian Embassy in Moscow is also hosting a series of B2B meetings to promote joint ventures, new trade partnerships, and deepened economic ties.
With Indian engineering exports to the U.S. down nearly 9.4% year-over-year, the outreach to Russia appears both strategic and well-timed. The question now is how India will navigate this delicate balance: leveraging potential U.S. tariff reductions while simultaneously expanding trade ties with Moscow. Like many regional powers, India continues to hedge carefully, managing relations with a mercurial Washington while pursuing growth opportunities in the China-aligned “non-Western” sphere.
Trump’s comments may mark the early signs of a broader recalibration in U.S. trade policy. In parallel, Russia is moving ahead with its own strategic realignments: President Putin has ordered a new roadmap for critical mineral extraction to be submitted by December 1st, along with plans to develop logistics hubs along the Chinese and North Korean borders. These initiatives underscore Moscow’s intent to deepen Far East engagement and strengthen its hand in the global supply of rare earths. Which are vital to defense, electronics, and EV production.
Meanwhile, Switzerland finds itself in a very different position. A long-standing U.S. economic partner, it was blindsided by the 39% tariff hikes announced earlier this year. On Monday, Trump acknowledged the impact, saying, “I haven’t said any number, but we’re going to be working on something to help Switzerland along; we hit Switzerland very hard. We want Switzerland to remain successful.” Reports suggest the 39% tariff could soon be lifted, with one major exception being gold, which will remain subject to a 50% duty.
Background: Why Tariffs?
India
Before the recent tariff escalations, the United States and India shared one of the fastest-growing bilateral trade relationships in the world. In 2024, total trade between the two nations reached $212.3 billion, an 8.3% year-over-year increase, with the U.S. serving as India’s largest trading partner. Although India accounted for just 1.3% of total U.S. trade, it had become a critical node in America’s strategy to diversify supply chains away from China, particularly in pharmaceuticals, textiles, and precision engineering.
U.S. imports from India totaled $87.3 billion, encompassing nearly half of all U.S. generic medicines, along with refined diamonds, textiles, and specialized machinery. This web of interdependence made the subsequent tariff escalation all the more disruptive.
In mid-2024, the U.S. increased duties on select Indian products in response to India’s continued reliance on Russian crude imports, citing G7 sanctions. India had become the top buyer of Russian oil, with purchases peaking that year. Consequently, tariffs (a primary foreign policy lever of the Trump administration in 2025) were imposed to exert both economic and diplomatic pressure. The move reflected growing U.S. concerns over India’s alignment with Russia and its implications for sanctions enforcement, particularly given Trump’s repeated statements about ending discounted Russian oil sales “ASAP.”
Switzerland
In contrast, tariffs on Switzerland were driven less by geopolitics and more by trade imbalances and WTO-related disputes. The dramatic 39% duty was introduced as part of a so-called “balancing package,” designed to offset perceived currency and trade asymmetries with low-tariff economies such as Switzerland, Singapore, and Liechtenstein.
In August, the U.S. imposed a 39% tariff on Swiss imports, threatening access to one of its largest markets for watches, machine tools, and chocolate. However, Switzerland is now nearing an agreement to reduce the rate to 15% on U.S.-bound exports, a development that would offer significant relief from the punitive levy. Although the deal has not yet been finalized, markets have reacted positively to the news. The breakthrough follows weeks of intensive shuttle diplomacy (where mediators travel back and forth between negotiating parties), as well as high-profile meetings between President Trump and prominent Swiss business leaders & billionaires, including Richemont CEO Johann Rupert and Partners Group founder Alfred Gantner.
The Shift: Signals Behind Trump’s Comments & Sectoral Implications
Undoubtedly, there is motivation to ease trade tensions amid global inflation and supply chain pressures, but also as the Trump tariffs continue to be scrutinized by the Supreme Court. With an increasingly assertive China, and by extension – Russia, the US is aiming for a degree of diplomatic recalibration through strengthening partnerships with neutral and non-aligned economies. The potential gesture toward India serves as a counterbalance to China’s growing influence in Asia and comes at a moment of clarity: if the United States does not normalize relations, India will strengthen economic ties not only with China, but also with Russia, swinging the pendulum of global integration eastward.
For India
If tariffs are rolled back, India stands to benefit across several strategic sectors. Lower duties would restore competitiveness for pharmaceuticals, IT services, and engineering goods, all vital to India’s export economy. Given that the U.S. is India’s top destination for manufactured goods, tariff relief could help reverse the recent 9.4% decline in engineering exports before those products are redirected to Russia. On the energy front, easing trade restrictions may open the door to the U.S.-India collaboration on energy diversification, particularly in liquefied natural gas (LNG) and renewables. Such a pivot would allow India to gradually reduce its reliance on Russian oil while deepening its commercial and technological engagement with U.S. energy firms. Indian Negotiators aim to finalize the bilateral trade deal by December, and the leaders have agreed to meet in February amidst discussions of doubling bilateral trade to $500 billion USD by 2030.
For Switzerland
For Switzerland, tariff aid would offer much-needed relief to exporters in precision industries, notably watchmaking, machinery, pharmaceuticals, and specialty chemicals. These sectors have faced substantial cost increases since the 39% tariff was introduced earlier this year. From the U.S. perspective, lifting or reducing those tariffs would lower costs for American importers sourcing high-end manufacturing inputs from Swiss firms, many of which supply components for aerospace, biotech, and clean-energy technologies. Restoring smooth trade flows could help revive investor confidence in transatlantic manufacturing partnerships.
Geopolitical Context
Trump’s remarks must also be understood within the broader geopolitical chessboard reshaped by the Russia-Ukraine war, sanctions fatigue, and shifting alliances. The United States is actively repositioning its alliances in a world where economic dependencies increasingly dictate political leverage. India’s balancing act of maintaining ties with Russia while expanding its defense and tech relations with the U.S. underscores the complexity of Washington’s approach. For Trump, softening tariffs could be a pragmatic way to pull India closer after months of strained rhetoric and lost ground to Beijing and Moscow.
For Switzerland, the situation is different. As a traditional neutral power and a financial hub, Switzerland’s alignment has symbolic importance: offering tariff relief could reinforce the U.S. commitment to free-market allies while signaling restraint in a period of aggressive economic nationalism.
At the multilateral level, these moves could influence G7 and WTO dynamics, especially as developing nations increasingly criticize the U.S. for “weaponizing tariffs.” Hitting refresh with key trading partners might help rebuild credibility in the global rules-based system, though critics will note that such flexibility often coincides with political expediency rather than principle.
In Conclusion:
The announcement underscores the US Administration’s transactional approach and pursuit of quick gains by punishing, then rewarding compliance with return to the status quo. Big picture, this is a sign that tariffs remain a key foreign policy lever in shaping alliances and market access.The tariffs are not merely punitive measures, but rather are part of a broader test of India’s geopolitical independence. For Washington, it’s about leverage and compliance; for New Delhi, it’s about asserting sovereignty. With trade volumes large enough to hurt both sides and alliances shifting in Asia, Trump’s recent promise to lower tariffs may be less about goodwill and more about regaining lost influence. For Switzerland, driving down tariffs is about restoring the diplomatic relationship and predictability, as well as rekindling trust and strengthening the trans-Atlantic relationship. As America’s strong trading partner in key industries like pharmaceuticals, precision manufacturing and finance, the 39% tariff sent a shock through the system that even President Trump has acknowledged as dramatically costly. Rolling back the tariffs would give the US an opportunity to rebuild trust and pull allies back in at a time when confidence in the rule-based order has been shaken.