India must not let energy security become a US trade ‘weapon’, warns GTRI

Washington could use the threat of tariffs of up to 100% to pressure India into cutting Russian oil purchases and making concessions in a bilateral trade agreement, think tank Global Trade Research Initiative (GTRI) warned on Thursday, after the US Congress cleared legislation targeting major buyers of Russian energy.

“The new US Act turns sanctions into a trade weapon against India,” GTRI founder Ajay Srivastava said.

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The think tank argued that Washington could threaten steep tariffs before offering a lower rate if New Delhi reduces its purchases of Russian crude and agrees to concessions in an India-US trade deal. GTRI described such a potential agreement as “deeply unequal” and urged India not to trade its energy security for temporary tariff relief.

The trade-deal linkage is GTRI’s assessment of how Washington could potentially use its new tariff powers, rather than an announced negotiating position of the US administration.

US Congress clears tariffs of up to 100%

The warning comes after the US House of Representatives passed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 by 262-159 on September 16. The Senate had approved the legislation 86-11 on August 7, sending it to President Donald Trump for his signature.

The legislation allows the US president to impose additional tariffs of up to 100% on goods from the five largest buyers of Russian crude oil and natural gas. India and China, among the biggest purchasers of Russian crude, could potentially be targeted.

A 100% tariff has not been imposed on Indian goods. After the legislation is signed, the US Trade Representative would identify countries covered by the measure and recommend tariff rates, according to GTRI.

Affected countries would ordinarily have 180 days to reduce Russian energy imports or negotiate with Washington, although the president can shorten that period, the think tank said.

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Russia now supplies over half of India’s crude

For India, the threat comes at a time when Russia has become its dominant source of crude oil.

Russia supplied $7.27 billion worth of crude to India in July 2026, accounting for 51.1% of the country's total crude imports of $14.21 billion, according to GTRI. India imports more than 88% of its crude-oil requirements.

Russia alone supplied more crude to India during the month than six other major suppliers combined. The UAE accounted for 10.8% of imports, Saudi Arabia 9.6%, Venezuela 6.3%, Brazil 5.5%, Oman 5.3% and the US 2.9%.

India's oil basket has changed sharply since 2022. Gulf countries supplied more than 55% of India's crude until that year, while Russia's share was below 15%. The Gulf share has since fallen below 30%, while purchases from Russia have increased substantially, GTRI said.

Could India face more pressure than China?

Despite China buying more Russian crude than India, the think tank argued that New Delhi could face greater pressure from Washington because the US may be more wary of retaliation from Beijing.

GTRI cited Washington's previous treatment of the two countries, pointing out that the US imposed an additional 25% Russia-related tariff on Indian goods in July 2025 while sparing China. The tariff on Indian goods was withdrawn in February 2026.

The assertion that India could face greater pressure than China is GTRI's assessment and is not stipulated by the legislation.

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Will an India-US trade deal provide protection?

Srivastava also cautioned against assuming that concessions on Russian oil or the conclusion of a bilateral trade agreement would permanently insulate India from US trade action.

“Neither signing a trade agreement nor stopping Russian oil purchases can protect it from future US action under Section 301, sectoral measures or other trade laws.”

GTRI pointed to subsequent US trade actions involving partners including the European Union, Japan and South Korea to argue that a trade agreement does not necessarily prevent Washington from imposing measures under other US trade laws.

GTRI says India should protect energy security

“India should not allow US tariff threats to determine its energy policy.”

The think tank argued that discounted Russian crude has helped lower India's import bill, strengthen energy security and contain inflation. It said India should continue buying Russian oil as long as it remains commercially competitive while negotiating with Washington without granting unilateral trade concessions.

The eventual impact on Indian exports, however, remains unclear. It can be assessed only after the US announces which countries will be targeted, the tariff rates, products covered and implementation timetable, GTRI said.