India says Russia sanctions bill threatening 100% tariffs can impact US ties, global energy market

The bill does not compel tariffs. But once signed, it gives Trump a durable, congressionally authorised tool to penalise buyers of Russian energy.

India on Thursday warned that a US sanctions bill authorising tariffs of up to 100% on the five largest buyers of Russian oil could have implications for the bilateral relationship and the global energy market, hours after the US House of Representatives passed the legislation, sending it to President Donald Trump’s desk.

Prime Minister Narendra Modi interacts with US President Donald Trump at the G7 Summit, in Evian (@narendramodi X)

The Lindsey O Graham Sanctioning Russia and Iran Act of 2026 cleared the House on Wednesday by 262-159 margin, after passing the Senate 86-11 on August 7. It grants Trump the authority to impose tariffs of up to 100% on goods from the five largest purchasers of Russian crude oil and natural gas — a list that, by current import volumes, includes China, India, Slovakia, Hungary and Azerbaijan.

The bill does not compel tariffs. But once signed, it gives Trump a durable, congressionally authorised tool to penalise buyers of Russian energy — distinct from the executive tariff powers that have faced legal challenges, including a Supreme Court ruling in February that struck down the use of the International Emergency Economic Powers Act for trade duties.

India’s external affairs ministry said in a statement that the government was determined “to take all necessary measures to protect its trade and economic interests” and would work closely with trade and industry bodies to deal with the fallout. New Delhi has discussed the bill “at high levels in recent months with various US interlocutors,” the ministry said, adding that India had “very clearly articulated” the potential implications — “for not just the bilateral relationship but also the international energy market.”

Implications of the legislation

The statement reiterated India’s position that its energy purchases are guided by national interest. “India remains firmly committed to ensuring energy security for its 1.4 billion people,” the ministry said, adding that the country would continue sourcing energy through “diversified sourcing and on the basis of evolving market dynamics.”

India has in recent months increased purchases of energy from the US and Venezuela as part of efforts to diversify, but Russia remains its largest source of crude oil. Russia supplied 51.1% of India’s crude imports in July, according to the Global Trade Research Initiative (GTRI) — more than the UAE, Saudi Arabia, Venezuela, Brazil, Oman and the US combined.

The bill does not name any country as a target. Instead, it uses a formula: the US Trade Representative, in consultation with the Secretary of State and Secretary of Energy, will identify the five largest importers of Russian crude and gas by total volume over the preceding 12 months, with the list reassessed every 180 days. The tariff rate, up to the 100% ceiling, is set at the president’s discretion.

The legislation includes an exemption for countries whose Russian natural gas imports account for less than 15% of Russia’s total gas exports and that are “taking significant steps” to reduce those imports — a provision that would shield several European nations but does not extend to oil purchases and does not cover India or China. A separate provision authorises tariffs of up to 500% on goods imported directly from Russia.

The president can waive tariffs on any country by certifying to Congress that the waiver serves the national interests of the US. To permanently lift them, he must certify that the country has stopped purchasing Russian energy and has provided “reliable assurances” it will not resume.

The passage of the bill came after members of the majority Republican party brought the legislation to a vote this week after prolonged uncertainty. Only a week ago, the bill’s fate was thought uncertain amid divisions in both the Republican annd Democratic parties over handing Trump expanded tariff authority ahead of November’s midterm elections. The House Rules Committee allowed the bill to progress on Monday, and on Tuesday the House narrowly voted 214-211 to schedule a final Wednesday vote after two Democratic lawmakers unexpectedly crossed the aisle to support the measure.

“Today is a big day. Congress has just sent an unmistakable message to Putin,” said Senator Jeanne Shaheen, who played a central role in backing the legislation.

The White House’s role in securing passage remains unclear. Last month, US Ambassador Sergio Gor said Trump’s support for the bill had been muted even as legislators sought to give him expanded tariff authority. But recent reports in US media indicate the White House may have played a key role in pushing the bill through by persuading opposition Democratic lawmakers to vote for it.

India’s purchases of Russian crude have been a persistent irritant in the bilateral relationship. India scaled back Russian oil imports under US pressure through much of 2025, but the widening conflict in West Asia and the effective closure of the Strait of Hormuz forced New Delhi to seek alternative supplies.

Washington itself granted a series of general licences temporarily allowing countries including India to resume Russian purchases to cover the shortfall. India’s Russian crude imports subsequently surged 34% month-on-month to record levels in June 2026, valued at €4.5 billion, making India the second-largest buyer behind China, according to the Centre for Research on Energy and Clean Air.

The bill’s 12-month lookback period for identifying the top five purchasers would capture that surge.

Ajay Srivastava of the Global Trade Research Initiative said Washington could use the tariff threat to pressure India into reducing Russian oil purchases and accepting an unequal trade agreement. “India should protect its energy security and continue buying Russian crude while it remains commercially competitive,” he said.

India-US ties fell to their lowest point in more than two decades after Trump imposed 50% tariffs on Indian exports last year. The two sides reached an understanding in February to slash tariffs to 18% as they worked towards a bilateral trade agreement. Though leaders from both countries have said they have agreed on most elements of the deal, it is yet to be signed.

Trump has repeatedly threatened tariffs on countries purchasing Russian oil as his frustration grows over his inability to end the war in Ukraine. Russia and Ukraine have intensified long-range air strikes in recent weeks as the front lines remain largely static.

India’s ambassador to Russia, Vinay Kumar, has previously called US tariffs imposed over Russian oil purchases “unfair, unreasonable and unjustified,” pointing out that other countries, including European nations, also trade with Russia.