By Ashok Nilakantan Ayers
WASHINGTON: President Donald Trump’s signature on Friday has given the United States a powerful new instrument to pressure Russia—and potentially the countries that continue to buy Russian oil and gas.
The signing of the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 transforms what had been a congressional threat into law, opening the door to tariffs of as much as 100 per cent on major purchasers of Russian energy.
The law is therefore much more than another sanctions package against Moscow. Its most consequential provision reaches beyond Russia itself. It gives the American president the authority to penalise countries whose purchases of Russian energy continue to provide revenue to Moscow. India and China, the two largest Asian purchasers of Russian crude, are consequently at the centre of the new confrontation.
The legislation is also the final major legacy of the late Senator Lindsey Graham, who had championed the measure for more than a year before his unexpected death in July. Graham had been one of the strongest advocates in Congress for tougher economic pressure on Vladimir Putin. The bill that bears his name passed the Senate 86-11 and subsequently cleared the House 262-159 before reaching Trump’s desk. Trump’s signature therefore gives legislative permanence to a campaign that Graham did not live to see completed.
The headline figure—100 per cent—needs careful interpretation. The law does not automatically impose a 100 per cent tariff on Indian or Chinese goods. Rather, it authorises Trump to impose duties of up to that level on imports from countries that purchase Russian crude oil or natural gas, subject to the law’s conditions and presidential decisions. The legislation also gives the administration considerable discretion over implementation and possible waivers.
That distinction could become the centre of the next phase of US-India and US-China diplomacy. Trump now has three broad choices: use the authority aggressively, use it selectively as negotiating leverage, or refrain from imposing the maximum tariff while retaining the threat.
For India, the third-country sanctions mechanism creates a particularly difficult dilemma. New Delhi has repeatedly argued that its Russian oil purchases are driven primarily by energy security and market conditions. After Congress passed the legislation, India’s External Affairs Ministry said the country remained committed to ensuring energy security for its population and warned that the measure could have implications for bilateral relations and the international energy market.
India’s dependence on Russian crude increased dramatically after the Ukraine war disrupted established global energy flows. Russian oil became an important source of relatively competitively priced crude for Indian refiners. That arrangement has benefited both sides: Russia retained a major market for its oil while India obtained access to supplies that helped its refiners manage costs. A 100 per cent US tariff, however, would change the economics of the relationship even if Washington never directly sanctioned the oil transactions themselves.
Indian exporters to the American market could face dramatically higher costs. The consequences would extend beyond petroleum because India’s exports to the US include pharmaceuticals, engineering goods, textiles, electronics, gems and jewellery and other manufactured products.
At the same time, forcing India rapidly away from Russian crude could increase its demand for Middle Eastern, African and other supplies. With global oil markets already sensitive to geopolitical disruption, that could put upward pressure on crude prices. Analysts have warned that squeezing Russian supplies without replacing them could affect not only India and China but the wider energy market.
This is the central paradox of the legislation: the more aggressively Washington uses the tariff weapon, the greater the possibility that the resulting disruption could spill back into the American and global economies.
China’s response will be different. China faces the same statutory threat but possesses a very different economic and geopolitical weight. Beijing has already rejected what it calls American “long-arm jurisdiction,” arguing that sanctions imposed on third countries without an international legal basis or UN Security Council authorisation are unacceptable.
China is also Russia’s largest energy customer. That means the new American authority potentially turns Russian oil from a bilateral China-Russia energy relationship into another arena in the US-China strategic contest.
Trump is scheduled to meet Chinese President Xi Jinping on September 24. The timing is significant because the sanctions law arrives just before that meeting. The tariff authority could therefore become another bargaining instrument in Washington’s broader economic negotiations with Beijing.
China’s likely response, if tariffs are actually imposed, would have to be considered in the context of the wider US-China trade relationship rather than as an isolated Russian-oil dispute.
Moscow is the intended target—but India and China are the pressure points. For Russia, the objective is straightforward: restrict the revenue generated by oil and gas exports and increase the economic cost of continuing the war in Ukraine.
The law also targets Russian officials, financial institutions, defence-related entities and the so-called “shadow fleet” of tankers used to move Russian oil outside existing Western restrictions.
But Russia has already adapted considerably to Western sanctions since 2022. The creation of alternative trading routes, payment mechanisms, shipping arrangements and energy markets has reduced Moscow’s dependence on Western buyers.
That is why India and China matter so much. Washington is attempting to put pressure on Russia indirectly by increasing the cost for the countries that keep buying Russian energy. The theory is that if the world’s biggest buyers become reluctant to purchase Russian crude, Moscow’s ability to finance its war will eventually be constrained.
Whether that mechanism works will depend heavily on how India and China respond.
For India, China and Russia, the signing creates a common problem but not necessarily a common response. Russia has an incentive to protect its energy relationship with India and China by offering deeper discounts, alternative payment mechanisms or other commercial concessions. India has to balance its longstanding strategic relationship with Russia against its increasingly important economic relationship with the United States. Washington is a major market for Indian exports, while Moscow remains important for energy and defence.
China, meanwhile, has fewer incentives to accommodate Washington’s demands when the issue intersects with its larger strategic competition with the United States. This means the new law could have an unintended geopolitical consequence: instead of isolating Russia, it could encourage greater coordination among Moscow, Beijing and New Delhi in energy, payments and trade.
That outcome is not predetermined. Much will depend on Trump’s implementation decisions.
The most important consequence of Friday’s signing is therefore not that India or China has suddenly been hit with a 100 percent tariff. They have not. The significance is that the United States now possesses a congressionally authorised mechanism with which Trump can threaten those countries.
That changes the negotiating equation. Until now, the possibility of secondary tariffs could be treated partly as legislative uncertainty. After Trump’s signature, it became an established element of US policy. The uncertainty has shifted from whether Washington possesses the authority to whether Trump will use it, against whom, and at what level.
For India, China and Russia, the next stage will consequently be diplomacy, not merely confrontation. New Delhi is likely to emphasise energy security and the economic consequences of coercive tariffs. Beijing has already challenged the principle of US extraterritorial sanctions. Moscow will seek to preserve its Asian energy markets.
Washington, meanwhile, will have to weigh the objective of reducing Russian oil revenues against the consequences for American consumers, global oil prices, US exporters and relations with two of the world’s largest economies.
Graham’s final legislative project has therefore acquired a significance that extends far beyond the senator himself. His bill was designed to put pressure on Moscow. Trump’s signature gives Washington the legal instrument to put pressure on Moscow’s customers as well.
Whether that ultimately changes Russia’s behaviour—or instead produces a deeper economic and geopolitical divide between Washington and the countries buying Russian energy—will depend not on the signature itself, but on what the Trump administration does with the extraordinary authority Congress has now placed in the president’s hands.
Quite significant was the statement of senator Lindsey Graham’s sister: I wish he were alive to see it happen. He worked hard for a year on the bill (to end the 4- year war of Russia with Ukraine) and the US congress recognised his efforts with its passage and the President acknowledged it by signing it.
The ball is in the court of China, Russia and India. Will Trump pick up the ball and serve an ace? (IPA Service)
