The United States’ renewed threat of imposing punitive tariffs of up to 500 percent on countries trading with Russia has triggered alarm across the Global South, with India emerging as one of the most exposed economies.
US President Donald Trump has signalled a tight timeline to enforce the proposed measures if countries fail to align with Washington’s strategic demands, raising concerns of a major escalation in global trade tensions.
At the centre of the controversy is the “Sanctioning Russia Act of 2025”, a bipartisan bill sponsored by US Senator Lindsey Graham. The legislation aims to punish nations that continue economic engagement with Moscow, particularly those purchasing Russian petroleum products.
While framed as a tool to pressure Russia over the Ukraine war, the bill risks collateral economic warfare against countries like India, which have pursued energy security through diversified sourcing.
Tariffs as Weapon and Self-Inflicted Wound
If enacted, the bill would allow the US to impose crippling tariffs—up to 500 percent—on imports from targeted countries, a move that would sharply raise costs for American consumers and businesses alike.
The irony is hard to miss, since the United States is an import-dependent economy, reliant on other nations for everyday goods ranging from electronics and machinery to food products and pharmaceuticals.
Far from protecting American households, such tariffs would fuel inflation, disrupt supply chains and further strain an economy already grappling with deep internal challenges—rising healthcare costs, border management failures, gun violence, housing shortages and widening inequality.
By making imports prohibitively expensive, Washington would effectively be taxing its own citizens, most of whom are already financially stretched. Studies consistently show that nearly 70 percent of Americans live paycheque to paycheque, with limited savings and fragile access to basic living facilities.
Yet, instead of prioritising domestic welfare, the US continues to channel enormous resources into overseas conflicts and military interventions.
India, Energy Security and Strategic Autonomy
India’s position is rooted in economic pragmatism, not geopolitical defiance. After the Ukraine conflict erupted in 2022, New Delhi increased purchases of discounted Russian crude to shield its economy from global energy shocks.
Since then, India has actively diversified its energy basket, with Russian imports already falling sharply due to tighter sanctions and market constraints.
Despite this, Washington has continued to apply pressure. The US previously raised tariffs on Indian goods to 50 percent, citing New Delhi’s energy trade with Moscow.
The proposed 500 percent tariff regime would take this coercive approach to an unprecedented extreme, risking long-term damage to India–US relations at a time when both sides are negotiating a broader trade agreement.
A Bully’s Strategy: Loud, Confused, and Self-Defeating
The emerging pattern reflects what many countries increasingly see as American economic bullying—loud, punitive and strategically confused. In attempting to force compliance through tariffs and sanctions, the US is accelerating de-dollarisation, encouraging nations to reduce dependence on the dollar and seek alternative trade and payment mechanisms.
Across the Global South—and even within parts of the European Union—there is growing fatigue with Washington’s tantrums and hegemonic playbook. Countries are questioning why they should bear economic pain for conflicts not of their making, while US domestic priorities remain unresolved.
In its crass capitalistic intoxication, the US neglected long-term investment in its own human resources. Today, it is forced to import skilled and intellectual labour, even as it closes doors through restrictive trade and immigration policies. The contradiction is stark.
Isolation, Not Influence
Rather than isolating Russia alone, such sweeping tariff threats risk isolating the United States itself. As trade barriers rise, alternative supply chains deepen and non-Western economic blocs gain confidence, Washington’s leverage steadily erodes.
This moment could prove decisive. If the Global South chooses collective resistance, refusing to bend under unilateral economic threats, the US may find its internal fractures widening—socially, economically and politically. An America struggling with domestic unrest, inequality and institutional fatigue can ill afford a global trade war of its own making.
A Make-or-Break Moment
The proposed 500 percent tariff regime is not merely a challenge for India—it is a make-or-break moment for the United States. The choice before Washington is stark— pursue cooperative, multipolar economic engagement, or continue down a path of coercion that raises prices for its own people, weakens its economy, and hastens its global isolation. In trying to punish the world, the US may ultimately end up punishing itself.