India’s exports have come under renewed focus after the US Senate passed the Lindsey O Graham Sanctioning Russia Act, legislation that could pave the way for tariffs of up to 100 percent on imports into the United States from countries that continue purchasing Russian-origin crude oil or natural gas.
The bill faces further legislative and executive steps before becoming law.
The proposed legislation grants the US President power to impose tariffs of up to 100 percent on goods imported from countries that are among the five largest buyers of Russian crude oil or natural gas and continue making new purchases after the law takes effect. It also targets countries found to be facilitating Russian sanctions evasion.
US President Donald Trump in recent days has extended support to the bill. The bill passed the US Senate on Friday with bipartisan support with only 11 senators voting against it.
For India, the timing is significant.
Data from commodity analytics firm Kpler shows India’s imports of Russian crude climbed to a record 2.78 million barrels per day (bpd) in July, up 1.5 percent from June. Russian oil accounted for more than half of India’s total crude imports, underscoring Moscow’s position as New Delhi’s dominant supplier.
india’s overall crude oil imports stood at 4.96 million bpd during the month.
The surge in Russian purchases came as escalating geopolitical tensions in the Gulf and the Red Sea disrupted cargo flows from West Asia.
The proposed US legislation could significantly raise the stakes for countries such as India and China, which have emerged as the largest buyers of Russian crude since Western sanctions redirected Moscow’s exports away from Europe.
Section 113 of the bill specifically calls for duties of up to 100 percent on imports from countries that remain among the top five importers of Russian crude or natural gas and continue making purchases after enactment. The legislation also requires periodic reviews every 180 days to reassess the list of countries covered.
Section 115, however, authorises the President to waive the application of provisions of the Act if the President determines that doing so is in the national security interests of the United States.
For India, the implications extend beyond energy security. The US is India’s largest export market, and any punitive tariffs could affect sectors ranging from engineering goods and pharmaceuticals to textiles and electronics if the legislation is ultimately enacted and applied.
New Delhi was able to escape higher tariffs under the Forced Labour provisions with Washington levying 10 percent additional duty on Indian goods against the proposed 12.5 percent for other countries.
Radhika Goyal is Author of Taxconcept Gurugram head office, for deeply reported tax, gst and income tax articles on issues that matter. He splits her time between New Delhi and Bengaluru, and has worked as a reporter, a podcaster and an editor for publications across India.