Last week, the gavel fell with a thunder in Washington. But the echo that followed carried farther than Moscow. Perceptively, the Lindsey O Graham Sanctioning Russia and Iran Act of 2026 was presented as a measure against the Kremlin. But in reality, it was nothing of that sort. The legislation handed over to the American President discretion to impose tariffs of up to 100 percent on the largest buyers of Russian energy. Russia was just an excuse. Actually, both China and India were its prime targets.
This was the Trumpian technique laid bare. It also symbolised a mauling of its 250-year-old genealogy. The US was created to protect democratic values and ensure sovereignty. But the bipartisan resolve to punish rest of the world was not only a defiance of the popular American disapproval of the war against Iran and to save Ukraine, it was an attempt to impose its own terms for global business and strategic engagement.
It wasn’t aimed at seizing a territory. It wrote the terms of an invoice. A presidential mood swing can now achieve what gunboats once did, or missiles and drones are doing now. The sanctions were no more exceptional tools aimed at genuine offenders. The new code treats interdependence itself as a weapon. It means the one who controls the dollar and the world’s largest consumer market can convert another nation’s necessity into leverage. Choosing energy trade with Russia is just an example. Tomorrow, America will pick up something else to enforce its expansionist designs.
India’s vulnerability is the most pronounced. Russian crude accounted for roughly 30 percent of India’s oil imports last fiscal. After the Hormuz disruption thinned out Gulf supplies, that share climbed to nearly 48 percent by June. This was never a political gesture; it was arithmetic. India imports most of what it burns, and when one sea lane tightens, whatever cargo still reaches Jamnagar and Vadinar gets bought regardless of its origin. The cost of that oil has already climbed. In June, even with lower volumes moving through, the crude import cost ran some 40 percent above the previous year.
If Trump uses his newly acquired powers, Indian exports to the US would be under tremendous pressure. Goods exports to America exceeded $90 billion in 2025. Pharmaceuticals alone were worth nearly $10 billion, gems and jewellery close to $7 billion, and apparel and textiles added several billions. These figures translate into livelihoods and bottomlines of businesses in Tiruppur, Surat and Bhiwandi—not abstractions on a ledger. Their woes can amplify massively if the White House links Russian oil purchases, a BRICS communiqué, or simply a bad week in Washington to Indian trade.
It seems the New Delhi BRICS declaration has been read in Washington as a provocation, but it was really only a symptom. When one country treats the global payment system as its private instrument, other nations start looking for alternative doors. The Global South is not shielding Moscow. It is defending its own sovereign right to purchase fuel without seeking anyone’s permission. Surprisingly, Europe has accepted the American justification. In the bargain, it escaped from becoming its principal casualty. So, the intended target is the large Asian buyer and not whatever remains of Europe.
India’s external affairs ministry responded correctly and judiciously. It reiterated that energy security for 1.4 billion people will rest on diversified sourcing and prevailing market conditions. That formulation was necessary but insufficient. India should keep in mind that the next shock will not originate in South Block. It will trigger the moment a buyer in New Jersey cancels an order because Trump altered the list overnight.
In order to torpedo Trumpian traipses, India must arm herself with concrete armoury. A large number of stakeholders feel that the government should forge a permanent institutional framework rather than panic-driven initiatives after each crisis. To start with, the central government may consider constituting a high-powered commission to deal with economic security and sanctions within the Prime Minister’s Office.
Instead of leaving it the individual silos to deal with any emergency, the commission should include ministers from the external affairs, finance, commerce, petroleum and shipping ministries, and the Governor of the Reserve Bank. Even giant corporates dealing with international trade and finance should be made permanent members. Their collective wisdom and might can be used to counter any sudden move as most of them are very well-connected. If America doesn’t see reason, can Indian investors be persuaded to keep their investment plans on hold?
In addition, keeping in view the fast-changing world order, India should adopt multi-sourcing of oil needs as a policy. A thicker strategic reserve would also help, ensuring that a 30-day political deadline set in Washington does not translate into panic in Indian fuel markets. An abrupt, forced reduction in Russian supply would push up the price of every alternative barrel and stoke domestic inflation. Diversification is the sound response; theatrical gestures are not.
Finally, India should minimise the number of choke points through which American jurisdiction can freeze an entire supply chain. That requires accelerating work on non-dollar settlement mechanisms and rupee trade corridors that see genuine use rather than mere announcement. The dollar-based system will remain dominant for years to come. India does not need a fully parallel financial architecture immediately.
None of these preemptive actions amount to a direct confrontation with the US. Unfortunately, America remains one of India’s largest and most valuable export markets. The real choice facing New Delhi is not between defying Washington and submitting to it. But it is definitely between treating each one of Trump’s tirades as a passing diplomatic episode or recognising it as the new operating challenge. Secondary tariffs and discretionary sanctions are no longer rare instruments; they define a standing and coercive method of statecraft. Middle powers that respond only with statements will keep being caught off-guard. Those that build the institutional machinery to anticipate the next salvo will retain more control over their own choices.
India, as the fastest growing economy, possesses the means to do this. It has weathered earlier shocks, from technology-denial regimes after the nuclear tests to oil price spikes and previous tariff rounds, without mistaking any single blow for the end of the story. Resilience, however, is not simply a mood or a talking point. The war room ought to exist before the next punitive measures are announced. Otherwise, the truncheon will hit you hard again.
Read all columns by Prabhu Chawla
Prabhu Chawla
prabhuchawla@newindianexpress.com
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