Will America impose 100% tariff on India? Preparation of action against 5 countries buying Russian oil; Bill introduced in Parliament

A new bill has been introduced in the US Parliament, under which it is proposed to impose up to 100% customs duty on goods coming from five countries including India.

Interestingly, earlier in a proposal named ‘Sanctioning Russia Act’, it had been said to impose tariff up to 500%! The US government wants to take this strict step against India, China and three other countries because these countries are continuously buying crude oil from Russia. This bill has also received the support of the White House (US President’s Office) and efforts are being made to get it passed by the Parliament before August.

Which countries will be punished?

According to a report in Hindustan Times, US Senator Richard Blumenthal said that India, China, Slovakia, Hungary and Azerbaijan could come under the scope of this new proposal.

Senator Blumenthal argues, ‘By buying oil from Russia, these countries are helping Moscow economically. If this financial aid is stopped, then there will be pressure on Russia and Ukraine will help in ending the war as soon as possible.

Earlier there was a proposal of 500%, now there is some leniency

The only saving grace is that the new bill is a little less strict than the previous one. In the previous proposal, there was a demand to impose heavy taxes of up to 500% on countries purchasing energy from Russia, but it did not get much support. That is why in the new bill the maximum limit of this tax has been reduced to 100%.

Who will have the final decision?

Senator Blumenthal made it clear that the final decision on how much tariff will actually be imposed on which country will be taken by the US Trade Representative (USTR). If necessary, tax rates can be reduced slightly, but after doing so, the US Parliament will have to be informed about it.

Will the bill be passed before August?

In this bill, there is also a proposal to impose very stringent sanctions on Russia’s energy, defense, financial and industrial sectors. American lawmakers hope that it will be passed before August.

If this becomes law, it will have a big impact on the trade relations between India and America. However, it is a matter of relief that right now it is just a proposed bill, it is yet to go through a long legislative process to become a law.

What will be its impact on India?

If the US Parliament approves this 100% tariff bill, then Indian products sold in the American market will face a huge blow.

The prices of main goods sent from India to America like jewellery, textiles and engineering goods will immediately double there. Due to this, the demand for our goods in the American market may fall.

India is currently buying crude oil from Russia at very cheap prices. America is using this threat of 100% tax as a pressure, so that India reduces trade with Russia and instead is forced to buy expensive oil from the Middle East (Gulf countries) or America itself.

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