BIG RELIEF FOR INDIA - TRUMP WITHDRAWS PROPOSED 100% TARIFF

The US Congress passed the Lindsey O. Graham Sanctioning Russia and Iran Act, 2026. The law signed by President Donald Trump on 18 September 2026, gives the US President the power to impose tariffs of up to 100% on goods imported from major buyers of Russian oil and gas. Five major Russian crude buyers identified in the legislative discussion were China, India, Slovakia, Hungary and Azerbaijan. The proposed tariffs were due to take effect on 18th October, 2026

On 16th October 2026, Trump signed an executive order waiving the relevant tariffs and several other sanctions provisions, citing the national interest of America. However, the 100% tariff threat has been waived for now, it has not been permanently abolished.

Reasons of Trump’s withdrawal of the tariff measure

● The US and Russia announced an agreement that Russia will supply diesel to US & Global markets to help lower fuel prices. Russia agreed to immediately supply over 300,000 metric tons of diesel, followed by 500,000 tons in November, 1 million tons shortly thereafter, and up to an additional 3 million tons depending on the operational status of Russian refineries.

● Control of oil prices: Higher tariffs on countries purchasing Russian energy could increase global energy costs and put further pressure on consumers.

● US energy requirements: The Trump administration has sought to increase diesel supplies to global markets, including through an arrangement involving Russian diesel.

● Trade and diplomatic relations: Countries such as India and China had raised concerns about the proposed tariffs and their effects on trade relations with the United States.

● Presidential discretion: The new law allows the US President to waive the relevant measures by certifying that doing so is in the national interest.

Impact on India

India is one of the major buyers of Russian crude oil. The withdrawal of the proposed tariffs provides India with temporary relief from the threat of additional US trade penalties linked to its Russian oil purchases.

● India-US Trade Agreement: India and the US are having trade talks and are about to finalize everything. Trump's decision to withdraw the 100% tariffs has made it easier for both the countries to reach a suitable and mutually favorable agreement.

● Trade relief: Indian exports to the US face less immediate risk from these particular proposed tariffs.

● Energy security: India retains greater flexibility in sourcing crude oil according to price, availability and domestic demand.

● Diplomatic relations: The decision may ease tension between India and the US.

Trump's decision represents a temporary easing of the proposed economic pressure on countries importing Russian oil. For India, it reduces the immediate risk of additional US tariffs and provides greater flexibility in managing energy imports. The waiver can be reversed if the US administration later determines that further action is appropriate. It does not remove all existing US sanctions or other trade tariffs.However, because the waiver can be withdrawn, India must continue to assess its energy security, export interests and trade relations with the United States.