US presidential counsellor Peter Navarro has sought to lower tensions over a potential new tariff fight with India, saying US President Donald Trump and Prime Minister Narendra Modi have a “very good working relationship” and would be able to resolve the dispute over India’s Russian oil purchases.
His comments came after the US Senate passed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 by an 86-11 vote on August 7, giving the President proposed authority to impose tariffs of up to 100% on goods from major purchasers of Russian oil and gas.
India, which has sharply increased its Russian crude imports, is among the countries that could face the measure if it becomes law and Trump chooses to use the power. The bill now moves to the US House of Representatives, meaning the 100% tariff is not currently in force.
New Delhi has said it is “closely following” the developments and maintains that its crude purchases are guided by its energy-security requirements and sourcing strategy.
The latest episode adds pressure to already sensitive India-US trade relations, but Navarro’s remarks also leave room for direct diplomacy between Trump and Modi rather than an immediate escalation.
Trump-Modi Relationship Under Test
Navarro’s latest remarks are notable because he has previously been among the Trump administration’s strongest critics of India’s continued Russian oil purchases.
Responding to questions about the new sanctions legislation, he said Trump and Modi have a “very good working relationship” and indicated that the two leaders would “work that out”, signalling that Washington’s tariff threat does not necessarily mean the wider bilateral relationship is heading towards a rupture.
The comments come as the US seeks to increase economic pressure on Russia over its war in Ukraine by targeting not only Moscow but also major buyers of Russian energy. The Senate legislation would give the President significant discretion to impose tariffs of up to 100% on imports from countries identified among the largest purchasers of Russian oil and gas.
The measure has bipartisan backing and was passed 86-11, but it still requires action in the House before it can become law. Its passage has also prompted debate in the US over whether Congress should give the President such broad tariff powers, with some lawmakers warning that they could raise costs for American importers and consumers.
Meanwhile, India has maintained a cautious position. External Affairs Ministry spokesperson Randhir Jaiswal said in July that New Delhi was “closely following” the proposed legislation and was aware of the developments. Responding to questions about Russian oil, he said India buys oil “from various countries in the world” and that its purchases are based on its “approach towards energy sourcing”.
That position underlines the central issue for New Delhi: while Washington views Russian oil purchases primarily through the lens of sanctions and pressure on Moscow, India continues to frame its energy decisions around availability, affordability and national energy security.
Why Russian Oil Matters To India
India’s exposure to the proposed US tariff threat has grown alongside its dependence on Russian crude. After Russia invaded Ukraine in 2022, Indian refiners significantly increased purchases of discounted Russian oil as European buyers reduced their dependence on Moscow. Russian crude has since become a major component of India’s import basket.
In June 2026, Russia supplied more than half of India’s crude imports for the first time, with shipments reported at around 2.6 million barrels per day and Russia accounting for roughly 52% of the country’s crude imports, according to Kpler data cited by media reports.
Other reporting put Russian imports at around 2.7 million barrels per day during parts of June. The trend continued into July, when Russian crude imports reached another monthly record, according to data cited by the Centre for Research on Energy and Clean Air.
The development has strengthened Washington’s argument that India remains an important market for Russian energy revenues, while New Delhi sees the purchases as part of a broader strategy of sourcing crude from multiple suppliers.
The proposed Graham legislation is intended to change that calculation. Rather than imposing sanctions only on Russia, it would allow the US to put economic pressure on major third-country buyers by threatening their access to the American market. For India, a 100% tariff would be a significant concern because the US is an important destination for Indian exports.
However, the proposed measure should not be confused with an immediate tariff decision. The Senate has authorised the possibility of such action in the legislation; it has not imposed a 100% duty on Indian goods. The House must still consider the measure, and even if it becomes law, the tariff would depend on a decision by the Trump administration.
The bill also contains waiver and discretionary provisions, leaving space for negotiations. That distinction is particularly important as India and the US continue to manage a wider trade relationship involving tariffs, market access, technology, defence and energy.
The Earlier Tariff Showdown
The current threat follows an earlier and particularly contentious phase in India-US relations. In August 2025, Trump imposed an additional 25% tariff on Indian imports, specifically citing India’s continued purchases of Russian oil.
The additional duty took the combined tariff burden on many Indian goods to 50%, triggering sharp criticism in New Delhi. India defended its energy policy, arguing that its oil purchases were driven by national requirements and market considerations.
The dispute later appeared to ease in February 2026, when Trump announced that the US would reduce its tariff on Indian goods from 50% to 18% as part of a trade understanding that included India agreeing to stop purchasing Russian oil and increase purchases of US energy.
Media reported at the time that a White House official confirmed the removal of the separate 25% duty linked to Russian oil. Yet subsequent data showing renewed and record-level Russian crude imports has brought the issue back into focus.
The latest Senate bill now gives Washington another potential mechanism to pressure countries such as India, while also targeting Russian officials, financial institutions, energy interests and the so-called shadow fleet used to transport oil.
The measure was backed by the late Senator Lindsey Graham, who had spent more than a year pushing tougher economic pressure on Moscow. Reuters reported that the bill passed the Senate 86-11 on August 7, while its future in the House remains uncertain.
The stakes are therefore broader than oil alone. Washington wants to reduce the revenues Russia receives from energy exports and increase the economic cost of the Ukraine war. New Delhi, meanwhile, has to protect energy supplies for a large and growing economy while maintaining important relationships with Russia, the US and other energy suppliers.
A tariff as high as 100% could affect Indian exporters and potentially increase costs for US businesses importing Indian products, making the issue economically sensitive on both sides.
Navarro’s emphasis on the Trump-Modi relationship may therefore be an attempt to preserve diplomatic space while Congress considers the legislation. It also suggests that the next stage may be determined as much by political negotiations as by the language of the bill itself.
The Logical Indian’s Perspective
The latest India-US disagreement is a reminder that international relations are rarely shaped by a single issue. Energy security, trade, national interests and the devastating human consequences of the Russia-Ukraine war are all part of the same conversation. Governments have a responsibility to protect their citizens’ economic interests, but they also have a responsibility to pursue peaceful solutions when disagreements emerge.
At the same time, the concerns behind efforts to restrict Russia’s energy revenues cannot simply be dismissed, given the continuing human cost of the war in Ukraine. The more constructive path is therefore one that combines diplomacy with transparency: India should be able to explain its energy choices clearly, the US should use economic pressure proportionately, and both sides should keep channels of dialogue open.
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