The proposed legislation, formally called the Lindsey O Graham Sanctioning Russia and Iran Act of 2026, recently passed a key procedural milestone in the US Senate. The bill received support from 86 senators in a vote, with only 12 opposing. However, it must still go through the House of Representatives before it can become law.
What the bill allows
If the bill is signed into law, it would give the US president the power to apply tariffs of up to 100% on nations that import significant quantities of Russian oil and gas. Importantly, these penalties would not be automatically triggered and would depend on legal conditions as well as decisions made at the executive level.
India-US trade tensions
This potential new policy is unfolding as the US and India continue to negotiate their trade relationship. In February 2026, the two nations announced an interim understanding that included a reciprocal tariff of 18% on Indian exports. In return, India was to increase purchases of American energy and technology. However, this plan was halted when the US Supreme Court ruled against the mechanism used to implement the agreement. Now, Indian goods are subject to an extra 10% duty on top of standard Most-Favoured-Nation (MFN) tariffs.
Despite these disruptions, diplomatic and trade discussions remain active. Officials from both countries are working on a transitional agreement that could reduce trade barriers and expand economic cooperation. Kevin Hassett, director of the White House National Economic Council, stated that the effect of the sanctions bill on these talks is something the negotiating teams must decide.
The White House explains that the bill is designed to limit the financial gains that countries derive from purchasing Russian energy, especially those supporting Russia's military actions in Ukraine. India, along with China, Slovakia, Hungary, and Azerbaijan, has been highlighted as a key focus in this legislation.
Hassett, who has previously described the US-India relationship as "complicated," remains optimistic about a resolution. He believes the two nations can find common ground, despite the current trade challenges and the evolving legislative landscape.
Currently, the US is using a Section 301 framework to address trade issues, which ties additional duties to concerns about forced labor. This system has replaced the earlier Section 122 framework, which was put in place after the Supreme Court's ruling. Officials from both countries remain focused on finding a way forward to ease tariff pressures and strengthen economic ties.