US readies another bunker-buster for India. What can happen?

Time of India

4 days ago

A bipartisan bill in the US Senate, the Sanctioning Russia Act of 2025, threatens India with 500% tariffs for continuing to purchase Russian oil, aiming to cripple Russia's energy revenue. While the bill gains traction, the Trump administration resists, fearing it will undermine efforts to mend US-Russia relations and mediate an end to the Ukraine war.
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The rationale of the Sanctioning Russia Act of 2025
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What is Trump's stance on the economic bunker buster?
Are 500% tariffs feasible?
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India's unique position
After dropping bunker-buster bombs on Iran's underground nuclear facility at Fordow, America is threatening to drop a bunker-buster on India -- an "economic bunker-buster", as one of the proponents of the bill has called it. India stares at astronomically high 500% tariffs if it continues to buy Russian oil as a bill for new sanctions on Russia gathers bipartisan support in the US. In April, Senators Lindsey Graham (Republican) and Richard Blumenthal (Democrat) introduced the Sanctioning Russia Act of 2025, a bipartisan legislative proposal that seeks to fundamentally alter the global response to Russia's ongoing war in Ukraine. The bill mandates punitive economic action not only against Russia but also against any country that continues to purchase its energy products. Chief among these measures is an unprecedented 500% tariff on all US imports from countries that buy Russian oil, gas, petrochemicals or uranium.The bill's intent is to hit Russia where it hurts most, its energy revenue, and thereby force it to engage in genuine negotiations or risk economic isolation. Graham has labeled it an 'economic bunker-buster', a metaphor for the bill's aim to detonate the financial underpinnings of the Russian war machine by targeting its energy clients, primarily India and China.From the perspective of its sponsors, the bill is necessary because traditional sanctions and diplomatic overtures have failed to bring the war in Ukraine to a meaningful halt. Russia continues to benefit from robust energy trade, and much of this commerce flows through two of the world's largest economies, China and India, who have shown little interest in joining Western embargoes.By targeting these energy buyers with enormous tariffs, Graham and Blumenthal hope to choke Russia's export profits and deter countries from enabling its war economy. The bill's enforcement mechanism is rigid and automatic: if Russia refuses to negotiate in good faith or violates any future peace agreement, the tariffs kick in immediately, leaving little room for diplomatic maneuver.Earlier, Graham had warned India and China that if the bill got through, they would have "nobody to blame but yourself". "To China and India: if you continue to prop up Putin's war machine, you'll have nobody to blame but yourself," he said.Despite the bill's growing popularity on Capitol Hill, the Trump administration seems to be resisting it. Trump, who has made repairing US-Russia relations a central tenet of his second-term foreign policy, sees the bill as a direct obstacle to his strategic ambitions. According to The Wall Street Journal, the administration is quietly lobbying Senator Graham to weaken the bill, particularly by changing the mandatory language from 'shall' to 'may,' which would give Trump discretion over enforcement.Trump is also pushing for broad waiver authority that would allow exemptions for allies, essential goods and national security priorities. His core argument is that rigid, automatic sanctions undermine presidential flexibility and could derail his efforts to mediate an end to the Ukraine war through diplomacy rather than coercion.Despite White House resistance, the bill has attracted overwhelming support in the Senate. "I've got 84 co-sponsors for a Russian sanctions bill that is an economic bunker-buster against China, India and Russia for their brutal invasion... Russia's brutal invasion of Ukraine. I think that bill is going to pass. We're going to give the president a waiver. It will be a tool in his toolbox to bring Putin to the table," Graham told NBC News a few days ago."We are in conversations with the White House, obviously, about that subject and that issue … there's a high level of interest here in the Senate, on both sides of the aisle and moving on it, and it's very well could be something that we would take up in this work period," Senate Majority Leader John Thune told reporters early this month. "Obviously we're working with the White House to try and ensure that what we do and when we do it works well with the negotiations that they've got underway." The bill's success depends not only on its passage through both chambers of Congress but also on its ability to survive a potential presidential veto.The bill is likely to change significantly as it moves through Congress and in consultations with the Trump administration, Matt Zweig, senior policy director of FDD Action, a nonprofit advocacy organization affiliated with the Foundation for Defense of Democracies, has told Politico. It may also take a long time. 'With sanctions legislation, you're also normally dealing with iterative processes where you would want to go through every nook and cranny,' Zweig said.While supporters of the bill argue that harsh consequences are necessary to achieve peace in Ukraine, critics warn that rigid mandates could backfire, turning allies against the US, weakening multilateral opposition to Russia and harming the US itself. The most controversial feature of the bill, the imposition of 500% tariffs on all imports from countries that buy Russian energy, raises serious questions about feasibility and unintended consequences. While such a measure makes for a powerful political message, its implementation could trigger a cascade of economic disruptions.Edward Fishman, a senior researcher with the Center on Global Energy Policy at Columbia University, told Politico nearly two weeks ago that countries in the crosshairs of the bill would struggle to halt their imports of Russian energy overnight. Tariffs of 500 percent on imports of goods made in China would send prices soaring, disrupt supply chains and could drive up US unemployment to recessionary levels. Most likely, it would lead to a screeching halt in U.S. trade with China. 'It would hurt Americans quite a bit,' Fishman said. India and China buy roughly 70 percent of Russian energy exports, but several other countries that buy any oil, gas or uranium from Russia could also be exposed to tariffs under the bill. The US itself is still reliant on imports of enriched uranium from Russia to fuel its nuclear reactorsTrump himself has struggled with the fallout from aggressive tariffs. He imposed very steep tariffs on Chinese imports, only to backtrack within a month amid fears of consumer price spikes and market instability, leading to traders coining a phrase "TACO trade" in which TACO meant Trump Always Chickens Out. Applying such massive tariffs to economies as large and integrated as India and China could unleash retaliatory measures, inflation and even potential recessionary pressures. The result might be more damaging to the US than to the countries it seeks to coerce, weakening the sanctions' overall impact.Trump had to exempt several electronic goods, including iPhones, from his earlier tariffs on China, before scaling them back within a month because the tariffs would have significantly raised prices for American buyers. India too represents a particularly complex challenge. As a leading buyer of Russian crude, it falls squarely in the bill's crosshairs. Yet India is also the United States' largest supplier of generic pharmaceuticals, including many critical medications used daily in American hospitals and pharmacies.Imposing 500% tariffs on Indian imports would almost certainly lead to a big spike in US drug prices, possibly triggering shortages and pushing many treatments out of reach for lower-income patients. Such an outcome would be politically and economically untenable. Though the bill allows for a one-time 180-day national security waiver, experts argue this may not be enough to shield critical sectors like healthcare from its effects.Already, an India-US trade deal is in the works but facing hurdles. Indian officials are resisting the insistence of their American counterparts to allow lower-duty import of American agricultural products, fearing adverse impact on Indian farmers and health concerns related to genetically modified food, as per a recent TOI report.(With inputs from agencies)