500%, 100%, then a waiver: How India escaped Trump's Russia tariff threat
Benchmarks Nifty22,888.95-257.21FEATURED FUNDS★★★★★UTI Aggressive Hybrid Fund Regular Plan-Growth5Y Return8.8 % Invest NowFEATURED FUNDS★★★★★Motilal Oswal Midcap Fund Direct-Growth5Y Return18.64 % Invest NowEnter search…
In the beginning it was 500%, then it came down to 100% and then, a waiver. This is how the tariff threat has evolved from an ambitious proposal into a more flexible instrument of policy for Trump and US. For India, the immediate danger has receded. But with US retaining the power to reinstate the measures, the waiver offers relief rather than a lasting resolution.
Listen to this article in summarized format
Loading...×The tariff that Trump waived on Saturday for countries buying Russian oil was originally intended to be a eye-watering 500% levy before being watered down to 100% and then finally to a waiver, albeit temporary. In essence, what began as a proposal for exceptionally high tariffs became a more limited statutory power over time. The latest waiver has now put its immediate implementation on hold.The evolution of the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 reflects Washington's attempt to use trade as a weapon against Moscow without losing sight of its own economic and diplomatic priorities. For India, China and other countries that import Russian crude, each change has carried different implications for energy security, exports to the US and relations with Trump admin.
The original 500% threat
The proposal's early versions envisaged tariffs of up to 500% on countries continuing to purchase Russian oil and gas. The idea was to make access to the American market prohibitively expensive for countries whose energy purchases were seen as helping finance Russia's war in Ukraine.In January 2026, Trump backed a bipartisan bill championed by the late Republican Senator Lindsey Graham. Graham argued that the threat would give the US president leverage over India, China and Brazil, pushing them to cut their purchases of discounted Russian crude.
Also read | India escapes a costly tariff showdown as Donald Trump hits pause on Russia sanctions
Live Events
The proposal also envisaged duties of at least 500% on Russian imports into the US. Its wider objective was to increase the economic cost of doing business with Moscow and compel countries to reconsider their energy ties with Russia.
India faced particular exposure because it had sharply increased its purchases of Russian crude after Western countries reduced their reliance on Moscow following Russia's February 2022 invasion of Ukraine. Discounted supplies had become important for Indian refiners seeking affordable oil in international markets.
India's position was that energy sourcing had to reflect changing global market conditions and the need to secure affordable supplies for its 1.4 billion people. The proposed tariffs threatened to turn that energy policy into a wider trade dispute with Washington.
How 500% became 100%
The 500% proposal did not survive in its original form. A subsequent version of the legislation reduced the maximum tariff authority targeting major purchasers of Russian energy to 100%.The revised approach retained the central mechanism: the US president could use tariffs on goods from countries buying Russian oil and gas to pressure them to change their purchasing behaviour. But the potential levy was substantially lower than the earlier proposal.
The Graham Act, signed by Trump on September 18, 2026, authorised tariffs of up to 100% on the world's five largest importers of Russian energy. It also expanded sanctions targeting Moscow and provided for action against entities involved in evading existing restrictions.
Also read | Trump’s 100% Russian oil tariff U-turn has a catch
The change mattered to India because a tariff of this scale could affect far more than crude oil imports. Higher duties on Indian goods entering the US could put pressure on exporters and complicate bilateral trade negotiations.
The law therefore created a difficult choice for New Delhi. Cutting Russian oil purchases could affect its energy sourcing, while continuing them risked exposing its exports to punitive US tariffs.
The legislation also gave Washington leverage over China, another major buyer of Russian crude. Turkey, which also purchases Russian energy, faced the possibility of friction with the US over the same issue.
From 100% to waiver
The next shift came on October 17, when Trump invoked a waiver provision under the Graham Act. His executive order suspended the application of specified sanctions, restrictions and duties under the law, citing US national interests.The order did not erase the legislation or permanently surrender the president's authority to use it. Instead, it put the specified measures on hold while preserving the option of restoring them later.
This distinction is important. The 100% tariff provision remains part of the legislative framework, but the waiver prevents the specified measures from being applied for now.
The decision also comes amid a change in US's immediate priorities. Trump has sought to work with Russian President Vladimir Putin to release Russian diesel supplies into global markets. The objective is to ease US diesel prices, which have been hovering at record highs ahead of the November 3 midterm elections.
Enforcing the law's punitive provisions while pursuing additional Russian diesel supplies could have undermined that effort. Suspending the measures gives the administration room to address domestic fuel costs without immediately triggering another confrontation with major Russian energy buyers.
India gets breathing space, but uncertainty remains
For India, the waiver removes the immediate threat of a fresh tariff escalation linked to Russian energy purchases. It also reduces the risk of the issue becoming another obstacle in India-US trade negotiations.China and Turkey benefit from the reduced immediate risk of punitive action as well. The decision avoids an immediate clash with major energy buyers at a time when Washington is balancing its Russia policy against domestic economic concerns and wider trade relationships.
The waiver has, however, invited political criticism in the US. Some lawmakers have objected to Trump's decision to suspend provisions intended to increase pressure on Moscow. A bipartisan group of senators had urged him to enforce the law rather than pursue an arrangement with Putin over Russian diesel supplies.
Graham, who died in July, had argued that sanctions were necessary to bring Putin to the negotiating table over Ukraine. The legislation bearing his name was signed last month, in part as a tribute to his longstanding campaign for tougher measures against Russia.
Add as a Reliable and Trusted News Source Add Now!
(You can now subscribe to our Economic Times WhatsApp channel)
( Originally published on Oct 17, 2026 )In Video: Trump waives Graham law curbs, bringing relief to India and other Russian energy buyersRead More News onTrump Russia tariff waiverIndia Russian oil importsgraham billoil pricesrussia oiltrump
(Catch all the Business News, Breaking News and Latest News Updates on The Economic Times.)
...moreless(You can now subscribe to our Economic Times WhatsApp channel)
Read More News onTrump Russia tariff waiverIndia Russian oil importsgraham billoil pricesrussia oiltrump
(Catch all the Business News, Breaking News and Latest News Updates on The Economic Times.)
...morelessContinue reading with one of these options:Limited AccessFreeLogin to get access to some exclusive stories& personalised newslettersLogin NowUnlimited AccessStarting @ Rs120/monthGet access to exclusive stories, expert opinions &
in-depth stock reportsSubscribe NowET
Unlock Access to All Exclusives with ETPrime FREE TRIAL
15 Days Free: Unlock All ETPrime Exclusives, Market Tools & ePapers
Trial offer expiring in00 : 05 : 00
I'd rather pay ₹2599 nowUh-oh! This is an exclusive story available for selected readers only.
Worry not. You’re just a step away.
Prime Account Detected!
It seems like you're already an ETPrime member with
Login using your ET Prime credentials to enjoy all member benefits
Log out of your current logged-in account and log in again using your ET Prime credentials to enjoy all member benefits.
Unlock ETPrime's Exclusive Stories Today!
Big Price Drop! Flat 40% Off
Student Only OfferAlready a Member? Sign In nowAlready a Member? Sign In nowAlready a Member? Sign In nowOffer Exclusively For You
Save up to Rs. 700/-
ON ET PRIME MEMBERSHIP
Avail OfferOffer Exclusively For You
Get 1 Year Free
With 1 and 2-Year ET prime membership
Avail OfferOffer Exclusively For You
Get 1 Year Free
With 1 and 2-Year ET prime membership
Avail OfferOffer Exclusively For You
Get Flat 40% Off
Then ₹ 1749 for 1 year
Avail OfferOffer Exclusively For You
ET Prime at ₹ 49 for 1 month
Then ₹ 1749 for 1 year
Avail OfferSpecial Offer
Get flat 40% off on ETPrime
Avail OfferAvail OfferClaim NowAlready a Member? Sign In nowNeed Assistance?
Connect with an ETPrime expert for personalized support and guidance
+91 9484700004'; }); } if(listing) { var h3 = "You tried reading " + listArr.length + " locked stories in the past " + threshold + " days.", h4 = "Become an ET Prime member and don't miss out on these exclusive stories."; var html = '' + h3 + '
' + h4 + '
- ' + listing + '
What’s Included with
ETPrime Membership
1Exclusive Insights That Matter
Uncover the truth with our investigative stories
Make strategic moves using the real-world case studies
Read industry-specific stories to identify emerging trends
Spot opportunities with in-depth insights that matter
Trump temper on H-1B visas is forcing Indians to do these things to stay put in US
What Adani’s US indictment means for India Inc’s overseas fundraising
Why veterans like Reliance, L&T are on acquisition spree? Aswath Damodaran has an answer.
Will China’s dollar bond sale in Saudi Arabia trump the US in financial world?
Huawei launches its own OS to compete with Google and Apple. But can it win beyond China?
The problem with lab grown diamonds
Why a falling rupee is a better option for the economy
A list of top 20 momentum stocks that have delivered massive returns in one year
2Invest Wisely With Smart Market Tools & Investment Ideas
Alpha Trade
Get daily trade ideas from SEBI-registered research analysts.
Investment Ideas
Grow your wealth with stock ideas & sectoral trends.
Stock Reports Plus
All-in-one stock research with Stock Score, peer comparison & key signals.
BigBull Portfolio
Get to know where the market bulls are investing to identify the right stocks.
Stock Analyzer
Check the score based on the company's fundamentals, solvency, growth, risk & ownership to decide the right stocks.
Market Mood
Analyze the market sentiments & identify the trend reversal for strategic decisions.
Stock Talk Live at 9 AM Daily
Ask your stock queries & get assured replies by ET appointed, SEBI registered experts.
3Stay informed anytime, anywhere with ET ePaper
ePaper - Print View
Read the PDF version of ET newspaper. Download & access it offline anytime.
ePaper - Digital View
Read your daily newspaper in Digital View & get it delivered to your inbox everyday.
Wealth Edition
Manage your money efficiently with this weekly money management guide.
TOI ePaper
Read the PDF version of TOI newspaper. Download & access it offline anytime.
Deep Explainers
Explore the In-depth explanation of complex topics for everyday life decisions.
Health+ Stories
Get fitter with daily health insights committed to your well-being.
Personal Finance+ Stories
Manage your wealth better with in-depth insights & updates on finance.
5Enjoy Complimentary Subscriptions From Top Brands
Stream new documentaries from all across the world every day.
Stories you might be interested in
Figures reflect the source report and its stated period. This article is for information and is not investment advice.
