View from Delhi: Russia sanctions bill – а new pressure tool aimed at India

The US Senate has voted 86 to 12 in favor of legislation to impose 100% tariffs on India, as well as other nations, for buying Russian oil. When the Senate reconvenes in September, the bill is expected to pass, after which it will go to the House for a vote. The House, too, is likely to clear it.

A few observations are in order, stresses Kanwal Sibal, retired Indian foreign secretary and former Ambassador to Russia between 2004 and 2007.

First, all the talk of a bipartisan consensus in the US Congress in favor of strong ties with India has proved exaggerated. The Senate vote backing this punitive legislation was itself bipartisan. Senator Blumenthal has made it clear that the real targets of the bill are China and India, the two largest buyers of Russian oil.

When India-US ties were on an upward trajectory, Congress supported them. Now that the relationship is moving in the opposite direction, Congress is offering no resistance. New Delhi should draw a political lesson from this.

Second, reviving the issue of India’s purchases of Russian oil shows how short-term and ad hoc the US approach to policymaking can be. During the Biden administration, Washington had in fact encouraged India to keep buying Russian oil in order to prevent a sharp rise in global prices. The logic was simple: if Russian crude had been pushed out of the international market completely, no other supplier would have been able to fully make up the shortfall.

Trump tried to wean away India from buying Russian discounted oil by imposing an extra 25% penalty tariffs on us for such purchases. India, however, continued to buy Russian oil in large quantities. Not only that, the refined products made by Indian refineries from the Russian crude were exported to Europe to meet its energy requirements.

Third, the Senate is brazen about subscribing to double standards in shaping the legislation. The legislation has been drafted to exclude US allies from the purview of the 100% tariffs that would be imposed on India, China, Hungary, Slovakia and Azerbaijan. European states including Belgium, the Netherlands, France, Spain and Austria continue to buy Russian energy, as do Turkey and Japan, yet they have been shielded through openly selective carve-outs. In other words, discrimination has been written into the legislation with little concern for either political consistency or moral credibility. All the past rhetoric about the US-India partnership being “defining” for the 21st century, and about the two countries being “natural allies,” is now being jettisoned.

Fourth, the legislation gives the US president waiver authority, allowing him to suspend tariffs or sanctions if this is deemed necessary in the US national interest. This reflects a cynical game played by both Congress and the White House at times: creating a punitive instrument that can then be selectively wielded as leverage to force targeted countries into compliance with US demands.

Such countries would then be expected to approach the White House in search of a waiver, which the US administration could use to extract concessions on other unresolved issues where it had previously failed to get its way. Even if a waiver is not granted, and the sanctions provided for under the legislation are not immediately enforced, the sword of Damocles would still hang over the targeted country.

Fifth, for a global power like the United States – and given the role the Senate plays in shaping US foreign policy – it is striking how detached from reality some of its initiatives can be, as though lawmakers and policymakers have learned no lessons at all.

The threat of tariffs has not worked against China, which has retaliated with coercive steps of its own in the areas of exports of critical raw materials and products, forcing the US to back down. If President Xi’s visit to the US takes place in September as planned, this would hardly be the right time to threaten China with 100% tariffs for buying Russian oil. Does the US expect China to close the pipelines delivering Russian oil and gas to it? The US has such a sense of impunity that it believes it can act arbitrarily without cost.

The US now sees China – not India – as the principal challenge to its global primacy, including in the technology race. Yet driven by his own anti-Russian fixation and the prevailing mood in Congress, as well as by Washington’s frustration at failing to force Russia into submission through sanctions and a proxy war in Ukraine, Senator Blumenthal has advanced legislation that without good reason turns India into a scapegoat. Traditionally strong India-Russia ties remain a bugbear for American policy makers.

It is deeply galling for India, a massive energy importer, to be dictated to by the US where it may or may not source its supplies. This is fundamentally a sovereign trade decision that India alone should make.

read more in our Telegram-channel https://t.me/The_International_Affairs