At least 60 lawmakers have backed a new bill seeking to impose 100 per cent tariffs on five countries, including India and China, for buying Russian oil. However, the bill exempts European nations purchasing Russian gas under prescribed conditions. The bill, unveiled on Friday, has obtained the backing of US President Donald Trump and could be passed before August.
As Senator John Thune, the leader of the Republican Party in the Senate, has given the green signal to the bill, it is likely to pass in the upper chamber.
What Does The Bill Say?
The bill proposes granting the US administration the power to impose tariffs up to 100 per cent on the top five countries that purchase Russian oil or natural gas. According to US Senators, the tariffs will target China, India, Slovakia, Hungary, and Azerbaijan for buying oil from Russia. The bill also states that countries aiding in Moscow's evasion of sanctions will be subject to the same measures. The final tariff rate will be decided by the US Trade Representative (USTR).
The proposed bill underlines that countries whose Russian natural gas imports account for less than 15 per cent of Russia's total natural gas exports and that are taking significant steps to reduce those imports.
The USTR will also evaluate the top five purchasers of Russian oil and natural gas, adjusting tariff rates according to any changes in their buying patterns, as outlined in the bill's summary. The proposed bill mentions another exception, excluding the tariff on American purchases of low-enriched uranium used in its nuclear reactors.
India: 2nd Largest Buyer of Russian Oil
Last month, India's imports of Russian crude oil recorded high levels, rising 34 per cent month-on-month. Indian purchases of Russian crude oil were valued at 4.5 billion Euros in June, accounting for roughly 36 per cent of Russia’s exports. This made India the second-largest buyer of Russian crude oil behind China, the Center for Research on Energy and Clean Air said. In June, Washington let a general license that allowed countries—including India—to purchase energy without attracting US sanctions to expire.
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A Modified Version Of 2025 Act?
The Bill proposed on Thursday is a modified version of the 2025 Sanctioning Russia Act, which proposed percent tariff on countries purchasing Russian energy, including India. The top-line tariff has been brought down to 100 per cent and the scope of the tariff is limited to the top five purchases of Russian oil or gas instead of applying to a broad swathe of countries.
If enacted, the measure would mark the first time the US Congress has explicitly authorised tariffs as a geopolitical tool to penalise countries financing another nation’s war effort.
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