Washington D.C. – The finalization of the EU India trade deal has triggered intense scrutiny from US Treasury Secretary Scott Bessent, who has launched scathing criticism alleging that the agreement indirectly finances the Russia-Ukraine conflict through Russian oil trade arrangements.
Bessent’s Explosive Allegations Against the EU India Trade Deal
US Treasury Secretary Scott Bessent has openly criticized the recently finalized EU India trade deal, claiming that European nations are inadvertently funding a war against themselves. Speaking in a Sunday interview, Bessent expressed frustration that just as the United States imposed 25 percent tariffs on India for purchasing Russian oil, European leaders signed a trade agreement with the country.
“Just to be clear again, the Russian oil goes into India, the refined products come out, and the Europeans buy the refined products. They are financing the war against themselves,” Bessent stated, outlining his theory on how the EU India trade deal facilitates this arrangement.
Understanding the Russian Oil Connection
Bessent’s theory centers on a specific trade mechanism involving Russian crude oil. According to his explanation, India imports Russian oil, refines it into various petroleum products, and then exports these refined products to European markets. The Treasury Secretary argues this circular arrangement means Europeans are indirectly purchasing Russian oil despite sanctions, thereby providing Moscow with revenue during the ongoing Ukraine conflict.
The Trump administration has taken a hardline stance on this issue, imposing a total of 50 percent tariffs on India—including 25 percent specifically targeting the Russian oil trade relationship. Bessent emphasized that under Trump’s leadership, the administration aims to eventually end the Russia-Ukraine war, suggesting these tariffs are part of a broader strategic approach.
The Historic EU India Trade Deal Takes Shape
Despite American opposition, India and the European Union moved forward with their trade agreement, which was declared “finalized for legal scrubbing of the text” in New Delhi. The formal announcement of the concluded negotiations is scheduled for January 27, marking a significant milestone in economic cooperation between the two regions.
European Commission President Ursula von der Leyen, who attended India’s 77th Republic Day celebrations as chief guest, described the EU India trade deal as the “mother of all deals.” This characterization underscores the agreement’s potential economic significance for both parties.
The trade negotiations that culminated in this agreement actually began in 2007, making the finalization a nearly two-decade-long diplomatic achievement. The timing proves particularly strategic, as both India and Europe seek to counter the disruption caused by US tariff policies under the Trump administration.
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Republican Opposition to Trump’s Tariff Strategy
Internal disagreement within the Republican Party has emerged regarding Trump’s approach to the EU India trade deal and related tariff policies. Senator Ted Cruz reportedly attempted to persuade President Trump against imposing widespread tariffs, warning of severe political consequences.
According to leaked audio recordings of Cruz’s phone calls with donors, the Senator cautioned Trump: “You’re going to lose the House, you’re going to lose the Senate, you’re going to spend the next two years being impeached every single week.” Cruz suggested it was the White House itself blocking potential compromises with India.
Trump initially imposed 25 percent tariffs on India in 2025, which were subsequently doubled to 50 percent months later in August, citing Delhi’s trade relationship with Moscow as justification.
Canada Joins India in Responding to US Pressure
The EU India trade deal reflects a broader pattern of nations realigning their trade relationships in response to Trump’s aggressive tariff policies. Canada, under Prime Minister Mark Carney, is undertaking a significant foreign policy recalibration by pivoting toward India as a primary strategic and economic partner.
Ottawa faces a 35 percent tariff on Canadian goods, with threats of a potential 100 percent tariff if Canada is perceived as facilitating Chinese exports. To protect its sovereignty and avoid being treated as a “51st state,” Canada is working to double its non-US exports within ten years.
Both Canada and India currently face high US tariffs, accelerating their push for a Comprehensive Economic Partnership Agreement (CEPA) targeting $50 billion in bilateral trade by 2030. Prime Minister Carney is expected to visit India in March to sign deals focused on uranium, energy, minerals, and artificial intelligence.
Strategic Implications for Global Trade
The EU India trade deal represents more than just an economic agreement—it symbolizes a strategic realignment in global trade patterns. For India, the agreement provides access to European markets while diversifying away from US dependence. For Europe, it offers an alternative to American economic dominance and access to a massive growing economy.
Bessent’s criticism highlights the complex geopolitical tensions underlying modern trade agreements, where economic partnerships intersect with security concerns and strategic rivalries. As nations navigate these competing interests, the EU India trade deal stands as a significant example of how countries are reshaping their economic alliances in response to changing global dynamics and protectionist trade policies.
