US President Donald Trump on Friday signed an executive order waiving sanctions on Russia and holding off tariffs on countries such as India that buy Russian energy, two days before they were due to take effect. Trump used a waiver authority in the recently passed Lindsey O Graham Sanctioning Russia and Iran Act, which was intended to cripple Russia's energy sector and punish buyers of Russian oil and natural gas. It was only four weeks earlier that Trump had signed the Graham Act into law.
HT looks at the US President's reversal in position and what it means for India.
What do the waivers mean?
On September 18, Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 into law. The act required the US President to impose heavy sanctions on the Russian economy and tariffs on Russia's trade partners from October 18 unless he waived them. These included tariffs of up to 100% on the top five purchasers of Russian oil and gas, which the Act's backers said included India, China, Azerbaijan, Slovakia and Hungary.
In addition, tariffs of up to 500% were to be levied on Russian exports to the US, and up to 100% on countries helping Russia evade sanctions.
Friday's executive order suspended most of those provisions until further notice. No tariff rate had been set for any country, and none had been imposed.
{{/usCountry}}Friday's executive order suspended most of those provisions until further notice. No tariff rate had been set for any country, and none had been imposed.
{{/usCountry}}Also read: Deferred 100% US tariffs offer only temporary relief to India as Russian oil imports fall
Why did this happen?
Trump's reasons appear to be mostly domestic.
On November 3, Trump's Republican Party and the opposition Democratic Party will face off in a crucial midterm election. High prices, driven by a sharp surge in energy costs since the US and Israel went to war with Iran in February, have hurt ordinary voters, who are increasingly unhappy with Trump's handling of the US economy, polls indicate.
With his approval ratings falling and his party facing the prospect of heavy losses, Trump has sought to stop energy prices rising further.
On October 9, he announced a diesel supply deal with Russia, and the US Treasury issued a general licence allowing buyers worldwide to purchase Russian diesel until April 7, 2027, in an effort to bring diesel prices down. Imposing crippling sanctions on the Russian energy sector under the Graham Act could have seriously disrupted global energy markets and pushed prices sharply higher. This largely explains Trump's decision to suspend most of the Graham Act's punitive provisions.
What impact will this have on India-US trade deal?
Trade experts say the waiver could help the deal's chances by removing some uncertainty about new tariffs on Indian exports, given India's position as one of the largest buyers of Russian oil.
"First of all, I think the talks are already on a better pathway. Recent meetings in Milwaukee and Washington generated new momentum, but the uncertainty over the possibility of new tariffs hasn't helped. Now that uncertainty is resolved, at least temporarily, and prospects for concluding the interim agreement have improved," said Mark Linscott, senior adviser at The Asia Group and formerly Assistant US Trade Representative for South and Central Asia.
However, a few outstanding concerns remain.
Under a framework agreed in February, Washington agreed to cut tariffs on Indian exports from 50% to 18%, including by removing a 25% penalty linked to India's Russian oil purchases, in exchange for New Delhi cutting tariffs on industrial and certain agricultural products.
The White House also said India had committed to ending its purchases of Russian energy, a characterisation New Delhi did not reaffirm. But later that month the US Supreme Court struck down the emergency tariffs on which those rates were based. Trump replaced them with a temporary 10% global tariff, which expired on July 24, leaving the deal's terms unclear.
India wants to ensure that its 18% tariff rate gives it an advantage over economic competitors such as Vietnam, Thailand, the Philippines, Indonesia, Malaysia, China, Bangladesh and Sri Lanka. Commerce minister Piyush Goyal said in June, and again on October 15, that the deal would not come into force until such an advantage is secured.
Washington, meanwhile, continues to push for greater access to the Indian market. Finance minister Nirmala Sitharaman said on October 5 that talks had reached a "plateau" and that further give and take would be "very, very difficult" for both sides.
Also read: 'Reward for Putin': Zelensky fears US sanctions relief to Russia, diesel deal not the end of it
Does this mean the threat of tariffs has passed?
No. US secretary of state Marco Rubio said on Saturday that the administration would take 60 days to examine the implications of the sanctions and tariffs for the US and global economy, although the executive order itself keeps the waivers in place until further notice. The order also directs the US Trade Representative and top cabinet officials to keep monitoring countries that import Russian energy, and to inform the President of any circumstances that might warrant revisiting the waivers. Linscott cautioned that no trade deal can be fully protected from such shifts.
"Unfortunately, no trade deal can be fully inoculated from future negative developments and misunderstandings. That's simply reality and is a reality that's not unique to the India-US relationship. That's also why every trade agreement includes provisions for changes and withdrawal. What's important for India and the United States is that both sides appear committed to concluding and implementing a trade deal to address their best interests," Linscott said.
A report from the Global Trade Research Initiative (GTRI), a New Delhi-based trade think tank, echoed that caution.
"For India, the waiver buys time but offers no lasting certainty. Russia's share of Indian oil imports fell from 51% in July to 44% in August as India bought more from the US, despite higher prices, and from the UAE. Yet SRIA [the Sanctioning Russia and Iran Act] remains law, leaving Washington free to revive the tariff threat to extract concessions in bilateral trade talks. India should protect its energy security, buy oil on commercial terms and prepare for renewed US pressure. Temporary tariff relief is no basis for permanent trade concessions," the report said.