In an executive order issued late Friday night, Trump said it was in the national interest of the United States to suspend certain restrictions. He had signed the sanctions-related bill into law in September, with the restrictions originally scheduled to come into force on Sunday.
The development came days after Trump said the United States would import diesel from Russia to bring down domestic energy prices ahead of the midterm elections scheduled for November. The elections will determine which party controls Congress.
The proposed move has surprised lawmakers, with members of both major political parties expressing opposition. For India, the legislation had been viewed as a threat that could strengthen Trump’s leverage over New Delhi, particularly at a time when Washington was also exploring the possibility of trade agreements with Russia.
Reacting to Trump’s decision, Suhasini Haidar, diplomatic affairs editor of the leading English-language newspaper The Hindu, wrote, “Unlike the period in 2019 and between November 2025 and February 2026, India made it clear that it would not stop buying oil from Russia because of the new US sanctions law. Making your limits clear and standing firm on them works.”
By August 2026, India had become the second-largest buyer of Russian oil after China. Consequently, the two Asian countries could face the greatest impact from potential US tariffs.
Between December 2022 and August 2026, China accounted for 50 per cent of Russia’s total crude oil exports, while India accounted for 37 per cent.
India’s Ministry of External Affairs issued a statement soon after the bill was passed. The ministry said it had raised the matter with the United States and emphasised that the legislation could affect not only bilateral relations but also international energy markets.
According to the latest figures for July 2026, Russia accounted for more than 51 per cent of India’s crude oil imports. With oil shipments through the Strait of Hormuz disrupted, substantially reducing India’s dependence on Russian oil within 30 days could prove difficult.
The potential impact of US tariffs also extends beyond energy trade to Indian exporters, who could face higher costs and reduced competitiveness in the American market.
If a US importer purchases a garment from India for $20, a 100 per cent tariff would add another $20 in duties at the border. Domestic transportation costs, retail margins and other taxes would then increase the final price. If the same product were available from another country at a considerably lower tariff, there would be little incentive to purchase the more expensive Indian product.
India is trying to reduce its dependence on the US market, but doing so will not be straightforward.
Free trade agreements may not replace the American market, but they can reduce the cost of entering other major markets. However, tariff concessions alone cannot guarantee access to those markets.
Indian exporters will need to invest in logistics, meet technical and product standards, adapt their designs and establish distribution networks. These are the same capabilities that helped them establish a presence in the US market.
Experts also caution that there are limits to export market diversification. If a company reduces its dependence on the United States from 60 per cent and becomes 60 per cent dependent on Europe instead, it has diversified geographically but not strategically. Broadening the customer base is therefore as important as diversifying markets.
The US sanctions law is named after the late Republican Senator Lindsey Graham of South Carolina. Before his death on July 11, he was one of Ukraine’s most vocal supporters in Washington.
The legislation targets the Russian economy and gives Trump broad powers to impose tariffs of up to 100 per cent on the five largest countries purchasing Russian oil and gas. China and India are among the countries specifically targeted.
The law also provides for sanctions against Russian President Vladimir Putin, senior Russian government officials, banks and other financial institutions, as well as Russia’s so-called shadow fleet. The tankers operating within this fleet are used to circumvent existing sanctions.
On Thursday, a group of 20 lawmakers from both major US political parties wrote to Trump urging him to comply with the new legislation, which was scheduled to take effect on October 18.
Last week, Trump announced that he had spoken to Putin by telephone and had agreed to purchase diesel from Moscow.
The move drew criticism from US allies, who fear that such purchases could help Russia sustain its war against Ukraine.
Ukraine Faces Growing Difficulties
Elizabeth Warren, the top Democratic member of the Senate Banking Committee, criticised Trump’s decision to grant exemptions from the sanctions.
“By waiving these sanctions, Trump is defying Congress’s directive to increase pressure on Russia. This is helping Vladimir Putin continue his war of aggression,” Warren said.
The decision not to impose sanctions on Russia comes amid renewed tensions between the United States and Ukraine.
Trump has put considerable pressure on Ukrainian President Volodymyr Zelenskyy to stop attacks on Russian oil refineries. Meanwhile, Russia has continued bombing civilian and energy infrastructure in Ukraine. More than 100 civilians have been killed in these attacks over the past week.
According to a report by the British newspaper Financial Times, Ukraine has faced unexplained interruptions in intelligence about incoming missile attacks that it receives from foreign partners. Restrictions have also been imposed on Elon Musk’s Starlink satellite internet services, which are used by Ukrainian drone units.
Trump has denied that the United States has stopped sharing intelligence with Ukraine.
During talks in Miami last week, US officials warned Ukraine that Washington could stop sharing critical intelligence if Kyiv did not halt its attacks on Russian oil refineries.
In an interview with the Financial Times this week, Zelenskyy adopted a firm position, saying he would resume attacks on Russian oil refineries in response to Russia’s continued bombardment of Ukraine.
He also strongly criticised Washington’s eagerness to pursue business agreements with Moscow and Trump’s apparent admiration for Putin.
The developments highlight the competing pressures facing Washington as it seeks to address domestic energy prices, manage relations with Russia and maintain its position on the war in Ukraine. For India, the potential use of steep tariffs remains a concern for both energy security and export competitiveness, even as the latest executive order raises questions about how the sanctions framework will be implemented.
About The Author
Comment List