Source The Hindu
Washington/New Delhi, January 8, 2026 — In a major escalation of trade and geopolitical tensions, U.S. President Donald Trump has endorsed a bipartisan sanctions bill that could permit tariffs of up to 500% on countries that continue to import Russian oil and energy products — a move widely seen as aimed at pressuring key global buyers including India, China, and Brazil.
The legislation, known as the Sanctioning Russia Act of 2025, was backed by influential Republican Senator Lindsey Graham and would authorize the U.S. government to impose punitive duties — dramatically higher than current levies — on nations trading in Russian-origin petroleum and uranium. Under one clause of the bill, the President “must increase the rate of duty on all goods and services imported into the United States from countries that knowingly engage in the exchange of Russian-origin … petroleum products to at least 500%.”
The move comes just days before the expected arrival of the new U.S. Ambassador-designate to India, Sergio Gor, who is scheduled to assume his post in New Delhi on January 12. Gor, confirmed by the Senate last year, previously described ending India’s imports of Russian oil as a “top priority” for the Trump administration during his confirmation hearings.
Tariff Threats Deepen Trade Strains With India
While the U.S. has already imposed steep tariffs on Indian imports — including a 50% levy tied to New Delhi’s continuing purchases of Russian crude — the potential 500% tariff represents a dramatic escalation that could fundamentally reshape trade flows between the two countries.
The heightened pressure has sparked anxiety in Indian markets, with investors reacting sharply to the spectre of punitive duties that could make Indian goods far less competitive in the U.S. market. Analysts warn that such measures could impact a wide range of sectors, from manufacturing to information technology.
New Delhi has insisted its energy decisions are driven by national interest and energy security considerations, even as Indian exports and diplomats seek relief from punitive tariffs. Efforts by India’s envoy to the U.S. to persuade lawmakers to reconsider additional duties have been reported, but no formal rollback has been endorsed by Washington.
U.S. Exits International Solar Alliance
In a parallel development, the Trump administration has signed a presidential memorandum withdrawing the United States from several international organisations and partnerships, including the India-France-led International Solar Alliance (ISA) — a global initiative aimed at promoting renewable energy. According to U.S. officials, the exit is part of broader efforts to streamline American participation in multilateral bodies that the administration views as misaligned with national interests.
The ISA withdrawal marks a symbolic setback in U.S.–India cooperation on climate and sustainable development, areas where both nations have traditionally sought alignment amid global energy transitions.
Global Diplomatic Ripples and Reactions
The tariff threat and shifting U.S. policy posture have drawn varied international responses. European nations such as Poland have publicly acknowledged India’s efforts to reduce Russian oil imports — with Polish officials saying they are “satisfied” with the reduction — even as they navigate their own relationships with Washington and New Delhi.
In New Delhi, officials have reiterated that energy diversification and diplomatic engagement remain priorities, even as geopolitical pressures mount ahead of high-level visits and negotiations.
