NEW DELHI, Oct. 15 -- US President Donald Trump is expected to decide within the next 10 days whether to invoke a new sanctions law that could expose India, China and other countries purchasing Russian oil and gas to tariffs of up to 100 per cent, US Ambassador to India Sergio Gor said on Thursday.
Speaking at the Bloomberg New Economy Forum, Gor said the legislation empowered the US administration to impose penalties on countries purchasing Russian energy or helping Moscow circumvent existing sanctions. However, he clarified that Trump had not imposed sanctions on any country under the legislation so far and that the measures were not specifically directed against India or any other nation. "He has to make a determination in the next I believe 10 or so days," Gor said, explaining that the legislation required the President to make a decision within 30 days of its passage. The announcement comes at a crucial stage in India-US trade negotiations, with both countries reporting substantial progress towards finalising a bilateral trade agreement.
The Lindsey O. Graham Sanctioning Russia and Iran Act, signed into law by Trump on September 18, gives the US President sweeping powers to impose tariffs of up to 100 per cent on countries meeting specified criteria relating to Russian energy purchases. The legislation covers major importers of Russian oil and natural gas, as well as countries found to be facilitating the evasion of sanctions imposed on Moscow. India and China, among the major purchasers of Russian energy, could potentially face penalties under the law. Gor said the legislation had received substantial bipartisan support in the US Senate, with 86 of its 100 members voting in favour.
He emphasised that the legislation was intended to increase economic pressure on Russia over the continuing war in Ukraine rather than punish Washington's trading partners. "The goal is not to punish anyone. The goal is to try to bring an end to this war," the ambassador said. He added that the Trump administration recognised that countries could not immediately abandon existing energy supplies and would need time to adjust their procurement arrangements. Asked whether India could receive relief from the proposed sanctions or qualify for an exemption, Gor said the decision rested entirely with Trump.
He did not indicate whether India would be granted any special consideration or whether tariffs would be imposed on Indian exports. The ambassador said the administration was engaging with its partners to gradually reduce the flow of revenue to Russia from energy exports. For India, the uncertainty is significant because Russian crude has remained an important component of its energy procurement strategy. New Delhi has consistently maintained that its energy purchases are guided by national interests, market conditions and the need to ensure affordable supplies for its population. The new US legislation could introduce additional uncertainty for Indian exporters, depending on how Trump exercises the powers granted under the law. Despite the possibility of fresh tariffs, Gor expressed confidence that India and the United States would conclude their bilateral trade agreement.
He said negotiations had made substantial progress and that the two countries had resolved the major issues involved in the proposed arrangement. "The big picture, the big framework, the big items are done," Gor said. According to the ambassador, negotiators were now working through smaller details, including product-specific tariff rates and other technical matters. He noted that the complexity of the negotiations reflected the size of the two economies and the thousands of products covered by the proposed agreement. Gor said the discussions had progressed rapidly compared with several other major international trade negotiations.
The ambassador also referred to the need to revisit certain provisions of an earlier trade arrangement following a US Supreme Court ruling that found the legal basis for some tariffs unconstitutional. Separately, India's Trade Secretary Rajesh Agrawal said on Thursday that the first phase of the proposed agreement had been finalised and was undergoing legal drafting. Agrawal said India was seeking preferential market access and greater tariff stability under the agreement, which both sides hoped to conclude and sign at the earliest opportunity.
Gor also highlighted opportunities for expanding bilateral cooperation in defence, information technology, semiconductor manufacturing, artificial intelligence and data centres. He described India as an important market for American companies and said deeper technological partnerships could benefit businesses and workers in both countries. The ambassador pointed to growing investments by American technology companies in India, particularly in semiconductor production and digital infrastructure. He said India had significant potential to become a centre for artificial intelligence development through partnerships with leading US companies. "India would be an incredible fit for AI, for tech development right here on their own soil, but partnering with some of our best companies is a win-win situation," Gor said. He also emphasised that investments by Indian companies in the United States were creating economic opportunities and supporting employment.
The developments come ahead of US Secretary of State Marco Rubio's scheduled visit to India as part of his October 17-22 overseas tour. Rubio is expected to hold discussions with Indian government officials and business leaders on energy cooperation, commercial investment and broader strategic relations. The visit assumes significance because it follows the enactment of the Russian energy sanctions legislation and comes as both countries move towards concluding their trade negotiations. Gor rejected suggestions that the frequency of high-level diplomatic engagement indicated tensions in bilateral relations, maintaining that Washington continued to regard India as an important strategic partner.
He cited cooperation in defence, technology, counterterrorism and investment as evidence of the breadth of the relationship. For New Delhi, however, the immediate focus remains on Trump's impending decision concerning Russian energy sanctions. While the proposed trade agreement could provide greater certainty for Indian exporters, the possibility of tariffs of up to 100 per cent presents a separate challenge. The extent of any impact will depend on whether Trump invokes the law, which countries are covered and whether exemptions or other relief are granted. The coming days could therefore prove important for both India's energy procurement strategy and the future direction of its trade relationship with the United States.
Published by HT Digital Content Services with permission from Millennium Post.