US President Donald Trump has assumed sweeping Congress-backed powers to impose tariffs of up to 100% on the top five buyers of Russian energy by signing the Sanctioning Russia and Iran Act late Friday. This puts India once again in the line of US trade action and brings fresh uncertainty to bilateral trade.
The law will take effect within 30 days, during which the US Trade Representative (USTR) will identify countries to be targeted and recommend tariff rates. The countries would normally get 180 days to reduce Russian energy purchases or negotiate with Washington, but Trump can shorten the period and impose tariffs sooner, according to an analysis by the Global Trade Research Initiative (GTRI).
Congress-Backed Authority
India, the second-largest buyer of Russian energy after China, is among the countries potentially covered by the law. The significance of the development lies in the fact that Trump’s new tariff authority is backed by Congress, unlike the broad emergency-power tariffs imposed earlier in his term that were subsequently struck down by the US Supreme Court.
The law, however, includes a national-interest waiver, giving the Trump administration discretion over enforcement. This could allow India to seek a waiver by offering concessions to the US in other areas.
The operationalisation of the law has added another layer of uncertainty for Indian exporters. “The likely impact on Indian exports can be assessed only after Washington announces the tariff rate, product coverage and implementation schedule,” GTRI’s Ajay Srivastava said.
The textile sector is particularly concerned. “Any additional tariffs under this Act will be very difficult to absorb for the MSME-dominated Indian textile and apparel sector already under stress due to several factors, including the continuing turmoil in West Asia. It will severely impact our ability to sell in the US, our most significant market by a distance,” Confederation of Indian Textile Industry Chairman Ashwin Chandran said.
Leverage and Defiance
On September 17, after the legislation cleared Congress, India issued a strongly worded response, reiterating that it “remains firmly committed to ensuring energy security for its 1.4 billion people” and would continue to source energy through “diversified sourcing and on the basis of evolving market dynamics.” New Delhi also warned of implications for the bilateral relationship and said it would take necessary measures to protect its trade and economic interests.
Although China buys more Russian crude than India, New Delhi has previously faced Russia-related tariff action. In July 2025, Washington imposed an additional 25% tariff on Indian goods over Russian oil purchases while sparing China; the additional tariff was withdrawn in February 2026.
Srivastava said Washington could again use the threat of a 100% tariff as negotiating leverage.
“Washington may threaten India with tariffs of up to 100% and then offer a lower rate (say 18% offered earlier through a joint statement dated February 6) if New Delhi sharply reduces Russian oil purchases and accepts concessions under an unequal bilateral trade agreement,” he said. “India should not trade its energy security for temporary tariff relief. Neither signing a trade agreement nor ending Russian oil purchases will protect India from future US action under Section 301, sectoral tariffs or other trade laws,” he added.