"India Faces Up to 110% US Tariffs Over Russian Crude Imports"
Section 301 (Trade Act of 1974)
US law authorising unilateral tariffs on countries with unfair or discriminatory trade practices.
GTAP Model
Global Trade Analysis Project — a multi-country general equilibrium model used to simulate economy-wide effects of trade policy changes.
The United States has long used unilateral trade law to pressure trading partners. Section 301 of the Trade Act of 1974 is the primary instrument. It authorises the US Trade Representative to investigate foreign trade practices deemed unfair or discriminatory. If such practices are confirmed, the president can impose tariffs, quotas, or other restrictions without going through the World Trade Organisation (WTO). This makes Section 301 faster and more flexible than multilateral dispute settlement, but also more prone to geopolitical use.
India's trade relationship with the US has grown significantly since 1991. The US is one of India's largest export destinations. At the same time, India has maintained strategic autonomy in its energy and foreign policy, including its ties with Russia and Iran. This autonomy has periodically created friction with Washington. The current episode is the sharpest such friction in recent memory, because it links India's energy choices directly to its trade competitiveness.
India's import of Russian crude oil rose sharply after the Russia-Ukraine conflict began. Before the conflict, Russian crude accounted for roughly 2% of India's total crude imports. By 2026, that share had risen to approximately 50%. India justified this on energy security and cost grounds. However, the US and its allies have consistently sought to limit revenue flows to Russia through sanctions and tariff pressure.
Section 301 investigations are unilateral. The US does not need WTO approval to impose tariffs under this provision. In July 2026, the US imposed an additional 10% forced-labour tariff on 60 countries, including India, under Section 301. This replaced an expired 10% duty under Section 122 of the Trade Act of 1974. For India, this alone raised the tariff burden on its exports to the US.
The proposed Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 goes further. It authorises tariffs of up to 100% on countries that are among the five largest importers of Russian crude oil or natural gas and knowingly make new purchases after the Act's enactment. India is currently among the largest importers of Russian crude. If this Act passes the House and becomes law, India's cumulative US tariff exposure could reach 110%. …
What are the challenges before the Indian economy when the world is moving away from free trade and multilateralism to protectionism and bilateralism? How can these challenges be met?
How would the recent phenomena of protectionism and currency manipulations in world trade affect macroeconomic stability of India?
Consider the following statements:
The effect of devaluation of a currency is that it necessarily
1.improves the competitiveness of the domestic exports in the foreign markets
2.increases the foreign value of domestic currency
3.improves the trade balance
Which of the above statements is/are correct?
Which of the following best describes the legal basis and scope of Section 301 of the US Trade Act of 1974?
Consider the following statements regarding the US trade measures affecting India in 2026:
1.The US imposed a 10% forced-labour tariff on India under Section 301 of the Trade Act of 1974.
2.If the proposed Russia sanctions bill becomes law, India's cumulative US tariff exposure could reach 110%.
3.Section 301 of the Trade Act of 1974 requires WTO approval before tariffs can be imposed.
4.The forced-labour tariff replaced an expired duty under Section 122 of the Trade Act of 1974.
How many of the above statements are correct?
Match the following trade policy instruments with their correct descriptions:
List I (Instrument) — List II (Description)
A.Section 301, Trade Act of 1974 — 1. Authorises tariffs on countries among the five largest importers of Russian crude
B.Section 122, Trade Act of 1974 — 2. Authorises unilateral US tariffs on countries with unfair or discriminatory trade practices
C.Proposed Russia Sanctions Act — 3. Provided a temporary 10% tariff authority that has since expired
D.GTAP Model — 4. A global general equilibrium model used to simulate trade policy shocks
With reference to India's crude oil import strategy, consider the following statements:
1.Before the Russia-Ukraine conflict, Russian crude accounted for approximately 2% of India's total crude imports.
2.By 2026, Russian crude accounted for approximately half of India's total crude imports.
3.India's increased Russian crude imports have no implications for its trade relations with the United States.
Which of the statements given above is/are correct?
Consider the following statements regarding the GTAP trade simulation findings on India's tariff exposure:
1.Under the full sanction scenario (110% US tariff), India's aggregate exports are projected to fall by approximately 5.1%.
2.Under the export diversification scenario (India-EU FTA), India's welfare improves by approximately $26.3 billion despite the same tariff environment.
3.The India-EU FTA is used in the simulation as a definitive policy prescription, not as a proxy for export diversification.
Which of the statements given above is/are correct?
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