In a surprising, yet not unexpected development, the US House of Representatives, by a substantial majority of 262-159, passed the Lindsey O. Graham Sanctioning Russia and Iran Act on September 16, granting explicit statutory authority to the US President to impose tariffs of up to 100% on imports from the top five global buyers of Russian crude oil and natural gas. The US Trade Representative will reassess the top five purchasing nations every 180 days to determine eligibility for tariff measures. Imports of crude oil and natural gas by the EU, and uranium, nuclear materials, fertilizers, etc., by the US, have been provided a carve-out from this legislation.
Out of those who voted for the Bill, 58 were Democrats, making this a bipartisan move. Discussions on this legislation had been going on for over a year, with the Bill itself having been tabled in the US Senate on April 1 last year. Senator Lindsey Graham aggressively campaigned for the bill, accusing buyers of Russian crude of funding “blood money”. Following the death of Senator Graham in July this year, lawmakers rallied to revive and push the measure through Congress as a memorial legislative effort. On August 7, the Senate passed the bill overwhelmingly in an 86-11 vote. The President signed the bill into law on September 18.
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India responded promptly to this development. The Ministry of External Affairs stated that India remains “firmly committed” to ensuring energy security for its 1.4 billion people and will continue doing so through diversified sourcing and according to evolving market dynamics. However, there was also a veiled but direct warning to the US. The Ministry added that India had discussed the issue at high levels with US interlocutors over recent months, and that the “potential consequences of the US measure for India-US bilateral relations as well as the international energy market” had been clearly communicated to Washington. It is evident that New Delhi is clear-eyed that the consequences could extend into the wider India-US relationship.
India’s Stance
India has consistently maintained that its oil purchases are driven by energy security, affordability, and national interest. Russian crude became increasingly important to Indian refiners after Western sanctions following Russia’s invasion of Ukraine. India’s message is diplomatic, but firm: decisions over India’s energy imports and energy security will be taken only by India, and no third-party interference will be brooked.
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As is evident, the legislation gives a powerful blunt instrument to President Trump to threaten India and other affected parties. It may be recalled that Trump and PM Modi had agreed during the latter’s visit to the White House on February 13 to finalise an interim trade deal. This has not been concluded thus far. Trump could be tempted to threaten India with additional tariffs unless it relents on opening up its agriculture, dairy, and MSME sectors. The US has been trying at least since July 2025 to force the entry of such American products into India, but New Delhi has made it clear that these sectors are protected since they concern the livelihood of farmers with small-holdings, small-scale entrepreneurs, and others whose survival would be threatened if exposed to US competition. India faced relentless pressure when a penalty tariff of 50% was imposed on it by the US for importing Russian oil, but even then, it refused to succumb to it. It is unlikely that such pressures could now force India to change its long-held position.
It may be noted that over the last several months, India’s imports of oil from Russia have been a little more than 2.5 million barrels a day, representing more than 50% of our daily imports. If the threat of tariffs on India increases, it could scale down its imports from Russia marginally while still maintaining it as a significant bulwark of its energy imports. This would help it to get reprieve from the US tariff threats while fully safeguarding its energy security as well as its exports to the US market, which comprise gems and jewellery, pharmaceuticals, leather and textile products, many of which are currently exported at low tariffs and by labour-intensive, small-scale industrial units.
Biden’s Request
It would be recalled that India was specifically requested by the Biden administration when the Russia-Ukraine conflict started to increase imports of Russian oil to moderate the global prices of oil and petroleum products. India had responded positively to the request. Both the US and Europe have been significant beneficiaries of India’s import of Russian oil, as refined products from this oil have found their way to their markets, thereby keeping the prices of these products low and reasonable there. It stands to reason that if Russian oil is removed from global markets, the impact on prices of refined petroleum products globally would be detrimental to the economies of the US, Europe, and others.
What India finds particularly galling is that the India-US comprehensive global strategic partnership, which has been nurtured so assiduously by both countries over the last 25 years, has now been thrown so casually under the bus. It appears reasonable that India is not the main target of this bill. It is Russia, and it is China; India is suffering collateral damage. But it is deeply troubling that in all the debates in the US Senate and the House, there have been no references to preserving and protecting the gains of the India-US partnership, which has evolved to be mutually beneficial over the last quarter of a century. The only rationale that most Democrats advanced for voting against the Bill was that they did not wish to grant such unbridled power and authority to Trump, which he would be most liable to misuse, as he has done in the past. There was not even a squeak in favour of safeguarding the gains and heights achieved by India-US ties over the last 25 years.
Blackmail Meets Hypocrisy
It is clear that this move is both blackmail and hypocritical: blackmail because it seeks to gain advantage and change India’s principled stand on its tariff regime in agriculture, dairy, MSMEs, etc, and hypocritical because, as mentioned above, the US has provided exemptions for the import of natural gas to the European Union, and to itself for fertilizers and nuclear material coming from Russia.
The way forward for India on the bilateral India-US front is to clearly articulate that India recognises only UN-imposed sanctions and will not abide by any unilateral sanctions imposed by an individual country. This needs to be done while continuing the diplomatic negotiations to satisfactorily resolve the issue.
India’s Options
On the domestic front, India urgently needs to diversify both its export markets for goods and services, as well as its sources for meeting its energy needs. India should reduce its excessive dependence on the US market for its exports. For the last few years, it has done this aggressively by signing ambitious trade deals with important markets and technology hubs such as the EU, the UK, the EFTA, Australia, New Zealand, the UAE, etc. On the energy front as well, India has been fiercely exploring other sources for meeting its requirements of oil and gas. Till a few years ago, India was importing energy from about 27 countries. Today, within the span of a few years, this number has risen to 43.
India also needs to ensure that it is not inordinately dependent on only one or two sources for its energy. For instance, before the Hormuz crisis struck, India was dependent on Gulf states for more than 90% of its LNG and LPG imports; today, it is about 50% dependent on the import of Russian oil. This needs to change.
India needs to increase its manufacturing capacity as well as promote self-reliance in defence manufacturing and supplies. The only way to go forward is to enhance its comprehensive national power by significantly strengthening its economy, its military prowess, technology development, infrastructure expansion, both social and physical, and global partnerships. India has already embarked on the above mentioned multi-pronged approach, which is yielding positive and encouraging results in not only improving the quality of life of its people but also enhancing its global authority and influence.
(Amb. Ashok Sajjanhar was with the IFS for over three decades. He was the ambassador of India to Kazakhstan, Sweden, and Latvia)
Disclaimer: These are the personal opinions of the author
