Despite initial political optimism early in the second Trump administration, India–US relations have severely deteriorated amidst escalating economic friction and diminished mutual trust. The comment argues that public rhetoric has started shifting from celebratory to confrontational stances by October 2026. The passage of the Sanctioning Russia and Iran Act, which grants the US president authority to impose up to 100% tariffs on nations importing Russian oil, presents an imminent threat. Given India’s position as a major importer of Russian crude, the analysis predicts President Trump will likely impose 25% tariffs on India by 18 October 2026 without granting a waiver, while potentially giving China a waiver. This development will likely collapse the India-US trade deal talks and force India to reconsider its participation in the upcoming G20 summit in Florida.
The coming week is likely to be significant from the viewpoint of the evolution/progress of the Indo-US relations in the coming years, both short term and long term.
Most analysts would agree that the Indo-US relationship which began with considerable political warmth and optimism at the start of the Trump II administration in February 2025, has experienced a significant deterioration in both political trust and economic confidence now in October 2026 with a series of deep systemic shocks that have severely strained bilateral ties. These have included tariff shocks and negotiations plateau in trade talks with a public rhetoric that has shifted from the celebratory tones of early 2025 to open public confrontational stances now.
The situation is most likely to get even worse in the remaining period of Trump II administration with the possibility of sure tariff threat, of upto100% Tariff, in the coming weeks made possible with the passage of the Sanctioning Russia and Iran Act of 2026 giving the U.S. president authority to levy up to 100% tariffs on nations importing Russian oil, resulting in the possible collapse of the talks on a India-US Trade deal.
To understand this, one has to read Sanctioning Russia and Iran Act (SRIA) closely, specially, Secs. 113 and 115, quoted below.
“SEC. 113. DUTIES ON COUNTRIES THAT PURCHASE RUSSIAN-ORIGIN CRUDE OIL OR NATURAL GAS OR FACILITATE SANCTIONS EVASION
- IN GENERAL. —Not later than 30 days after the date of the enactment of this Act, the President shall, notwithstanding any other provision of law, increase the rate of duty for all goods imported into the United States from a country described in sub-section (c) (and only from a country described in subsection (c)) to a rate of up to 100 percent ad valorem.
……
(c) COUNTRY DESCRIBED. —A country described in this sub-section is a foreign country that—(1)(A) knowingly made new purchases of crude oil or natural gas that originated in the Russian Federation on a date that is on or after 30 days after the date of enactment of this Act; and
(B) was among the 5 largest importers, by total volume, of crude oil or natural gas that originated in the Russian Federation during the most recent 12-month period preceding the date of the enactment of this Act; or
(2) was among the top 5 countries facilitating Russian oil sanctions evasion during the most recent 12-month period preceding the date of the enactment of this Act.”SEC. 115. WAIVER.
(a) IN GENERAL. —The President may, subject to subsection (b), waive the application of any sanctions provision with respect to a foreign person, any restriction with respect to a person, or any duty under this title.
(b) REPORTS REQUIRED. —(1) IN GENERAL. —Before issuing a waiver under subsection
(a), the President shall submit to Congress—
(A) a certification in writingthat the issuance of the waiver is in the national interests of the United States; and
(B) a report explaining the basis for the certification.
(3) FORM OF REPORT. —Each report required by paragraph
- shall be submitted in unclassified form but may include a classified annex.
Since the SRIA Act[1] was signed into law on 18 September 2026, Sec. 113 requires Trump toincrease, by 18 October 2026, the rate of duty, not fixed, but up to 100%, on goods imported from India, since it is definitely among the 2 largest importers of Russian crude. While it may not be 100% it will most likely be 25% which was the Russian oil imports secondary tariff imposed earlier and given the deterioration in Indo-US relations, the probability of Trump issuing a Sec. 115 waiver on ground that a waiver is in the national interests is not high. Why not?
In Executive Order 14329 of August 6, 2025 (Addressing Threats to the United States by the Government of the Russian Federation), Trump found that “the national emergency described in Executive Order 14066 (“the Russian Federation’s unjustified, unprovoked, unyielding, and unconscionable war against Ukraine”) has continued and continues to pose an “unusual and extraordinary threat to the national security and foreign policy of the United States.To deal with that threat,I determined that it was necessary and appropriate to impose an additional ad valorem rate of duty of 25 percent on imports of articles of India, which, at that time, was directly or indirectly importing Russian Federation oil.”
However, on February 6, 2026, through Executive Order 14384, Trump “determined that India has taken significant steps to address the national emergency (Specifically, India has committed to stop directly or indirectly importing Russian Federation oil and has represented that it will purchase United States energy products from the United States) and to eliminate the additional ad valorem rate of duty imposed on imports of articles of India pursuant to Executive Order 14329.”
However, it extended the national emergency arising out of invasion of Ukraine by one year till March 6, 2027.
However, India had not stopped importing Russian Federation Oil and continues to import such oil till now, thereby not addressing the national emergency in the US. But Trump could not reimpose the 25% tariff on India since in a major ruling on presidential power, the Supreme Court on Friday struck down the sweeping tariffs that President Donald Trump imposed in a series of executive orders.
For these reasons, the chances of Trump issuing a Sec. 115 waiver in favour of India on ground of national interest are low.
Sec. 113 (c)(1)(B) of the Act requires the tariffs to be imposed on the 5 largest importers of Russian crude, which would definitely include China. So, China, too, will have to be imposed additional tariffs. However, during the recent visit of the Chinese leader Xi Jin Ping to USA, both the leaders agreed to extend the tariff agreement signed on October 10, 2025 to January 10, 2027. And given the past responses by China to unilateral tariffs by US, it is most likely that Trump will issue a Sec. 115 waiver to China.
Therefore, by 18 October 2026, Trump would have imposed additional tariffs on India and announced additional tariff on China with accompanying waiver.
Since “The basic element of the India-US Trade deal is how it will give India a comparative advantage.” (Goyal at the ET Startup Awards 2026, Bengaluru on 9 October 2026.), there is very little chance of an India- trade deal.
Therefore, Indian Government will have to decide on (i) continuing with Trade talks (and no India-US trade deal), and (ii) evaluate PM Modi’s participation in 2026 G20 summit in Florida, USA, December 2026, at Trump’s clubhouse!
Editor’s Note: The analysis compellingly demonstrates that the structural tensions created by divergent energy security imperatives have reached a breaking point in India-US relations. India’s continued import of Russian oil, despite formal commitments to reduce such purchases, directly conflicts with US geopolitical objectives concerning Russia’s actions in Ukraine. This fundamental divergence, codified through the SRIA legislation, reveals that strategic partnership aspirations cannot overcome concrete economic and security interests. The predicted outcome—tariffs for India but waivers for China—underscores how bilateral relationships are increasingly being shaped by transactional logic rather than shared democratic values. This development suggests India must fundamentally reassess its approach to multilateral engagement, as participation in forums like the G20 summit becomes symbolically fraught amidst escalating trade tensions that threaten to redefine the partnership’s core dynamics.
P.S. (i) Incidentally, the results of the forthcoming 4 November, mid-term elections will have NO effect on the continuation of the tariffs on India -whether or not the Democrats control either the House or both the House and the Senate! And,
(ii) Trump’s recent agreement with Putin for import of Russian diesel, is NOT violative of Graham’s SRIA. THERE IS NO US SECONDARY SANCTIONS ON ANY COUNTRY IMPORTING RUSSIAN DIESEL. SRIA IMPOSES sanctions ONLY ON IMPORTATION OF Russian crude or Gas.
* Dr Gopalan Balachandran is an independent analyst. He is a Member of the Centre for Peace Studies (CPS) and has been in the editorial advisory board of Journal of Peace Studies (JPS). The views are his own.
[1] Sanctioning Russia and Iran Act of 2026 (SRIA), formally known as H.R. 5334, is legislation signed into law on 18 September 2026. Authored by Senator Lindsey O. Graham, this Act aims to enhance existing sanctions against Russia and Iran, particularly targeting Russia's energy revenue streams.
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