India Could Face 100% US Tariff Over Russian Oil: New Zealand and India Sign a Duty-Free Deal

The US has passed a Russia sanctions law allowing tariffs of up to 100% on major buyers of Russian oil and gas, which could affect India.

On 16 September 2026, the US House of Representatives passed a new Russia sanctions bill that allows President Donald Trump to impose tariffs of up to 100% on countries that continue buying Russian oil and gas. The bill passed 262–159 and was later signed into law by Trump on 18 September.

The bill was first introduced in 2025 by Senators Lindsey Graham and Richard Blumenthal. Earlier versions proposed tariffs of up to 500%. The main aim was to increase economic pressure on Russia over the war in Ukraine.

The bill includes sanctions against Russian officials, banks, energy companies and ships involved in helping Russia sell its oil while avoiding existing sanctions. It also allows tariffs on countries that are among the biggest buyers of Russian oil and gas.

India and China could be affected because they are among the biggest buyers of Russian crude oil. Data from the Centre for Research on Energy and Clean Air shows that China accounted for about 50% of Russia’s crude-oil exports and India about 37%, followed by Türkiye and the European Union at around 5% each.

The bill received fresh attention after Lindsey Graham died on 11 July 2026. The Senate later passed the updated bill on 7 August by 86 votes to 11. The updated version reduced the possible tariff on major buyers of Russian energy from the earlier 500% proposal to a maximum of 100%.

The proposal had raised concerns in India because higher US tariffs could affect Indian exporters. Some US lawmakers also raised concerns about the possible impact of the tariffs on trade and the US economy.

India-New Zealand Trade Deal

Meanwhile, New Zealand’s Parliament passed legislation on 16 September to bring its Free Trade Agreement with India into effect. The bill passed 93–29, with support from members of both the ruling National Party and opposition Labour Party.

Under the agreement, 95% of New Zealand’s exports to India will eventually receive lower or no tariffs. From the first day, 57% of New Zealand exports to India will become duty-free. In return, all Indian exports to New Zealand will receive duty-free access.

India and New Zealand formally ratified the agreement on 21 September, and it is set to enter into force on 20 October 2026.

The two developments come at a time when India is managing trade and energy ties with several major countries.