Lawmakers signed off on a wide-ranging sanctions package that targets the five largest buyers of Russian crude or natural gas. The bill now moves to the White House, and a White House official said President Donald Trump intends to put his signature on it within the next few days. If used, the new authority would allow tariffs as high as 100% on those buyers, a group that could include India, China and US ally Turkey.
India put out a sharply worded statement on Thursday noting it has engaged US officials for months about the fallout. "Its potential implications for not just the bilateral relationship but also the international energy market have been very clearly articulated by the Indian side," the Ministry of External Affairs said. The statement also added, "The Indian side has also made clear its determination to take all necessary measures to protect its trade and economic interests," and stressed, "India remains firmly committed to ensuring energy security for its 1.4 billion people."
US India relations have had their rough patches, from tariff run ins to Trump's claim last year that he helped mediate a halt to India Pakistan fighting - a version of events New Delhi has consistently rejected. The tone has improved lately as both sides increased high level engagement and Washington eased some duties on Indian goods, though negotiations on a wider trade deal are still unfinished. Even so, a comprehensive deal does not appear to be "a priority right now for both India and the US," said Ashok Malik of The Asia Group, adding, "Unpredictability of the White House has become a major imponderable."
India is currently the biggest buyer of Russia's seaborne crude, but its refiners have been broadening supply lines to the US, Brazil, Canada, Venezuela and parts of Africa. Even with that diversification, state owned refiners are dealing with the largest supply uncertainty they've faced in months as the lingering Middle East conflict overlaps with the prospect of tighter US limits on Russian purchases, according to Bloomberg News. On Thursday, Beijing reiterated its opposition to long arm jurisdiction and interference in trade.
"China has always conducted normal economic and trade cooperation with countries around the world on the basis of equality and mutual benefit," Foreign Ministry spokesman Guo Jiakun said. "Such cooperation neither targets any third party nor is it subject to interference or coercion by any third party." Among several potential openings for a meeting later this year between Indian Prime Minister Narendra Modi and Trump is the G20 summit in Miami.
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Consider this a new political lever that could reroute trade and energy flows if pulled. With the US accounting for about a fifth of India's exports, any shift in tariffs or diplomacy can ripple into supply chains and buyers that everyday companies rely on. Keep an eye on whether the president signs the bill in the near term and, more importantly, whether the powers are used.
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