The Russia Squeeze
Washington’s new Russia sanctions give Donald Trump a powerful economic weapon, but India’s response will have to balance energy security, trade and strategic autonomy.

The United States has acquired a new weapon in its economic arsenal, and it is powerful enough to hurt more than its intended target.
The Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, signed into law by President Donald Trump on September 18, gives the White House authority to impose tariffs of up to 100 percent on countries that continue to buy Russian oil and gas. The measure also targets Russian banks, energy interests and the so-called shadow fleet of tankers used to circumvent Western sanctions. The Senate approved the legislation 86-11 in August and the House followed with a 262-159 vote this month.
Its immediate purpose is to reduce the revenues that Moscow derives from energy exports and thereby increase pressure on Vladimir Putin over the war in Ukraine. But the legislation also turns the buyers of Russian energy, notably India and China, into potential instruments of American pressure. The result could be a complicated contest in which Washington seeks to squeeze Moscow without destabilising the global energy and trading system.
For India, Russian crude forms an important part of its energy strategy because it can be purchased at competitive prices, helping refiners manage costs and contributing to domestic price stability.
The legislation does not mean that a 100 percent tariff will automatically descend on Indian exports. It gives the President the power to impose such tariffs. That distinction leaves room for diplomacy, negotiation and exemptions. The law itself contains provisions allowing the administration to waive sanctions in certain circumstances, while its tariff provisions are designed to put pressure on countries whose purchases sustain Russian energy revenues.
Prohibitive Cost
A blanket tariff would not affect Russia alone. It would also raise the cost of doing business with countries caught in its orbit of energy trade. Indian exporters to the American market could face a severe competitive disadvantage if punitive tariffs were actually imposed.
There is an even larger question. Can sanctions designed to isolate Russia work without fragmenting the world economy further?
Washington’s argument is that countries purchasing Russian energy help finance Moscow’s war effort. The legislation’s sponsors have explicitly presented sanctions as a means of increasing pressure on Russia and bringing the war to an end. But the more countries are compelled to choose between American economic access and established energy relationships, the greater the incentive for them to develop alternative financial, trading and payment arrangements.
That is particularly significant for Russia, China and India. They are not a political bloc with identical interests, and their relationships with Washington differ sharply. Yet all three could be affected by the new American policy. China, like India, is a major purchaser of Russian energy and could face substantial consequences if Washington exercises its new tariff authority.
Russia’s energy revenues are among the foundations of its wartime economy, and Washington hopes to make the continuation of the war progressively more expensive. The new law attacks not merely individual Russian companies but some of the networks through which Moscow has maintained its energy exports despite existing sanctions.
Yet economic pressure has its own limits. Russia has spent years adapting to sanctions, redirecting trade towards Asia and developing alternative shipping and financial mechanisms. The effectiveness of another round will depend not simply on the severity of American measures but on how many countries are willing and able to participate in enforcing them.
India’s challenge is consequently one of balancing rather than choosing sides. New Delhi has little interest in becoming an instrument of Russian policy, but it has an equally strong interest in preserving affordable energy and protecting its strategic autonomy. Its response will have to combine diversification of energy supplies with sustained engagement with Washington and Moscow.
India has maintained relationships with Russia while deepening its partnership with the United States and other Western countries. The new sanctions regime will test how much room remains for that balancing act.
The larger danger is that tariffs become substitutes for diplomacy. Used indiscriminately, it can punish consumers and companies in the country imposing it as well as those in the country being targeted.
Washington’s pressure on Moscow therefore needs to be accompanied by a diplomatic strategy that recognises the interests of countries such as India and China.
(The writer is a foreign affairs expert. Views personal






Comments