Trade Storm Brewing? US Proposal for 100% Tariffs Puts India in Spotlight

India said on Friday it is closely tracking a proposed US Senate bill that seeks to impose tariffs of up to 100 per cent on countries continuing to buy Russian crude oil , a list that includes India. Responding to questions at the weekly media briefing, External Affairs Ministry spokesperson Randhir Jaiswal said, "We are closely following these developments, and we are aware of the proposed legislation." On India's oil imports, he reiterated that the country's energy procurement is driven by national requirement and market considerations rather than political pressure, adding, "As far as buying oil is concerned, we buy oil from various countries in the world. It is based on our approach towards energy sourcing ." Jaiswal also noted that seven Indian-flagged vessels are currently operating in the Persian Gulf , underlining that trade traffic between India and the region remains steady and unaffected.

The legislation, now officially named the "Senator Lindsey O. Graham Sanctioning Russia Act of 2026," was originally introduced in April 2025 by Democratic Senator Richard Blumenthal and Republican Senator Lindsey Graham . It has since been renamed in Graham's honour following his sudden death on July 11 . His sister, Senator Darline Graham , appointed to complete his term, has said passing the bill would honour his commitment to US national security.

A revised version, unveiled on July 14 with more than 26 bipartisan cosponsors and reportedly backed by around 60 senators , softened an earlier proposal that had called for a blanket 500 per cent tariff . The updated bill instead authorises tariffs of up to 100 per cent on the five largest buyers of Russian crude and natural gas , India, China, Slovakia, Hungary and Azerbaijan , while carving out an exemption for countries importing less than 15 per cent of Russia's gas exports if they show measurable progress in reducing that dependence. The compromise followed negotiations involving Lindsey Graham, Richard Blumenthal, Senator Jeanne Shaheen and Treasury Secretary Scott Bessent, and reportedly has written backing from the White House.

The bill remains at the proposal stage and has not become law, but its progress is being watched closely given its potential impact on global trade, energy markets and diplomatic ties. India has consistently maintained that its energy imports are guided by energy security, affordability and diversification of suppliers, not political considerations.