After America passed 'The Lindsey O. Graham Sectioning Russia and Iran Act' targeting Russia and Iran, the stir in diplomatic circles has intensified. Meanwhile, former diplomat Vidya Bhushan Soni has termed America's move as a strategic “pressure tactic”. They believe that the main objective of this bill is to stop India's energy imports from Russia and to impose its conditions on India in the stalled bilateral trade negotiations.
Let us tell you, expressing surprise that this bill was passed with overwhelming support by both houses of the US Congress, the former diplomat said that some Democrats, generally considered pro-India, have also joined hands with the Republicans to get it passed. However, he has tried to allay concerns among Indian policy makers and the market about the threat of 100% tariffs. He clarified that this bill is not an automatic trade penalty, but it empowers the US President as an 'enabling' measure to take wise steps as per the national interest. This does not mean that this law will be immediately and completely implemented.
Soni spoke candidly about Washington's intentions, calling it “two-way pressure.” On one hand, America wants India to slow down the import of crude oil from Russia, which is directly linked to India's economic and energy needs. On the other hand, this move is also related to the ongoing impasse over the pending trade deal between India and the US, as provisions were added by the US side that were not acceptable to the Indian negotiators. If this law is fully implemented, it could have a huge impact on India's major commercial exports like textiles, chemicals and pharmaceuticals, as their prices in the US market will become much higher after 100% tariff.
Despite this, the experienced diplomat has advised calm and expressed hope that the White House will make limited use of it keeping in mind the larger strategic relationship. He has expressed full confidence in the Indian team led by Union Commerce Minister Piyush Goyal that they will be successful in protecting the economic interests of the country. On the other hand, India's Ministry of External Affairs has also made it clear that the country's energy sourcing and procurement will always be decided keeping in mind the energy needs of its 1.4 billion citizens.