Understanding the Sanctioning Russia Act 2025: 500% Tariffs, Exemptions, and Global Impact

The “Sanctioning Russia Act of 2025” is a bipartisan bill (with Senate bill S 1241 and House bill HR 2548) introduced in the 119th Congress, aimed at imposing sanctions and other measures on Russia if its government refuses to negotiate a peace treaty in Ukraine. 

A key provision gives the US president the option to impose tariffs of up to 500% on imports from countries (such as India, China and Brazil) that continue to purchase Russian oil or gas after a specified deadline, as a way to pressure Moscow economically by cutting off its energy revenue streams.

Further, the bill requires the president to make periodic determinations (every 90 days after enactment) on whether Russia or its proxies have engaged in specific actions, like war crimes or territorial aggression, triggering additional penalties on Russian entities or individuals.

It’s framed as a “peace through strength” measure to support Ukraine and has been advanced by lawmakers like Sen Lindsey Graham (R-SC) and Rep Brian Fitzpatrick (R-PA).

President Trump has approved or “greenlit” the bill, paving the way for likely Senate action as early as next week. At least one news source explicitly states it has been signed into law, authorising the tariffs.

There’s a double standard in this US policy. Despite broad sanctions against Russia since 2022, the US continues to import substantial quantities of critical materials from Russia in 2025, often under waivers or exemptions justified by national security or supply chain needs. For example:

• Uranium: The US imported enriched uranium from Russia in 2025, with volumes on track to increase from prior years. Uranium is on the 2025 US “List of Critical Minerals” (added this year), and imports are allowed via special permits until a full ban takes effect in 2028. Russia supplies a notable portion of the low-enriched uranium used in US nuclear reactors, and the DOE has awarded billions to domestic producers to reduce reliance by 2028.
• Titanium: The US imports of titanium (including alloys, sponge and scrap) from Russia totalled around $32.6 million in 2024, with ongoing dependence in 2025 for aerospace and defence applications. Titanium is critical for industries like aviation, and Russia has been exempted from certain sanctions due to limited alternatives.
• Palladium: Imports of unwrought palladium from Russia continued in 2025, prompting US investigations into alleged dumping and calls for tariffs from domestic producers like Sibanye-Stillwater. Palladium (part of the platinum-group metals) is on the critical minerals list and essential for catalytic converters and electronics.
• Fertilisers (Including Potash): The US imports from Russia rose nearly 30% in 2025, reaching $5 billion by year-end, despite potash being added to the critical minerals list. This supports US agriculture but undercuts efforts to isolate Russia economically.

Overall, the US-Russia trade in 2025 was around $3.95 billion in the first half (up 61% from the previous period, still below pre-war peaks), focused on fertilisers, metals and uranium. The US is pushing to reduce reliance through domestic production and deals with allies (for example, Ukraine for minerals), but gaps persist.

Obviously, the US sanctions don’t apply to the US itself—they’re tools of foreign policy enforced by the US government on other entities, with built-in waivers for American interests (for example, energy security or defence needs). This allows imports when alternatives aren’t viable, even as the US pressures allies and adversaries to cut ties with Russia. The Trump tariffs amount to self-serving exceptionalism, while proponents argue it’s pragmatic realpolitik to avoid self-harm while advancing geopolitical goals. The 2025 critical minerals list expansion (to 60 items) highlights ongoing vulnerabilities, with the US 100% import-reliant for 12 minerals overall, though not all from Russia specifically.

Impact: Minimal

The 500% tariff provision in the “Sanctioning Russia Act of 2025” is designed to exert tremendous economic pressure on countries like India, China and Brazil to curb their purchases of Russian oil, thereby reducing Moscow’s energy revenues and weakening its position in the Ukraine conflict. However, the real impact varies by country due to differences in trade volumes with the US, economic structures, and alternative market options. Trump’s intent is to use this as leverage to force compliance, but it may not hit as hard as desired, particularly for India, where the exposure is relatively limited compared to China.

Comparative impact on India, China & Brazil

• Trade exposure to the US: The tariffs would apply to imports into the US from these countries, so the scale of pain depends on how much each exports there. Based on 2025 trade data:

1. 
   1.China is by far the most exposed, with US imports from China totalling around $400-450 billion annually (down slightly from pre-tariff peaks, still dominant). This represents a massive share of China’s export-driven economy, and 500% tariffs could devastate sectors like electronics, machinery and consumer goods, forcing Beijing to negotiate or retaliate.
   2. India’s US imports were about $100-120 billion in 2025 (up ~25% early in the year from 2024), far less than China’s (~1/4 the volume) and focused on pharmaceuticals, gems/jewellery, textiles and IT services. While not insignificant (the US is India’s top export market at ~18% of total exports), it’s a smaller slice of India’s $4.3+ trillion GDP, where domestic consumption drives ~60% of growth. This buffers India more than export-heavy China.
   > Brazil’s exposure is the smallest, with US imports from Brazil at ~$30-40 billion in 2025 (commodities like coffee, sugar, iron ore, and fuels). Brazil shrugged off the 40-50% US tariffs in 2025 by moving to China and others, achieving record exports overall. The 500% level would sting more but likely prompt similar diversification rather than full compliance.

• Broader economic effects: For India, the tariffs could add $9-11 billion to annual oil import costs if alternatives to Russian crude are pricier, likely to fuel inflation and raise fuel prices domestically. However, this is mitigated by India’s diversified energy imports (Russia was ~35% in 2025) and growing US crude purchases (up 92% in April-November 2025). China, as Russia’s top fossil fuel buyer (45% of exports in Nov 2025), faces steeper risks to its manufacturing base but has leverage via its own tariffs and domestic demand. Brazil’s hit would be narrower, mainly on commodities, but its diesel reliance on Russia (~60% of imports) could drive up transport costs.

The tariffs pack the most punch for China due to sheer volume, less so for India (where effects are more contained), and the least for Brazil (already adapted to previous tariffs). *Trump is overestimating his coercive power* here, as these countries have shown resilience.

Harm to American consumers vs Indian exporters

The tariffs could disproportionately hurt US consumers of Indian goods. Tariffs are essentially taxes paid by importers (often passed to buyers), so a 500% hike would spike prices for everyday items like generic drugs (India supplies ~40% of US generics), apparel and jewellery. This could add billions to US household costs, especially amid inflation concerns, and disrupt supply chains without quick domestic alternatives. US industries reliant on Indian inputs (for example, pharma, auto parts) might face higher costs, too, leading to job impacts or price hikes.

For Indian exporters, the loss of US competitiveness is real but not catastrophic. Many could switch to markets like the EU, Middle East, Africa or Southeast Asia, where demand for Indian goods is growing (for instance, via FTAs with UAE and Australia). Substitutes might emerge quickly—for example, textiles to Bangladesh and Vietnam buyers, and pharma to Europe. India’s total exports grew despite the older US tariff hikes (50% in Aug 2025), and government incentives for diversification could accelerate this. Overall, while some short-term pain for exporters, the domestic market and global shifts could absorb much of it, leaving US consumers bearing more of the brunt.

Are the sanctions achieving Trump’s desired outcome?

Trump’s goal is to starve Russia of oil revenues (which fund ~40% of its budget) by deterring buyers, ultimately pressuring Moscow towards a Ukraine peace deal. Results are mixed so far—some progress with India, but limited for China and Brazil, and Russia’s overall exports dipped only modestly in late 2025 (revenues down to $11B in November from higher prices/revenues earlier). The tariffs aren’t yet fully implemented (bill greenlit but enforcement pending determinations), so effects are anticipatory.

• India: There’s evidence of reduction, but not a full halt. Imports hit a six-month high in November 2025 (7.7M tonnes, 35-40% share), but are projected to drop below 1M bpd in January—perhaps the lowest in years—as refiners like Reliance halt deliveries amid US deal talks and weekly import monitoring. The tariff threat is working somewhat, prompting diversification (more US oil, for example). The Indian import of Russian oil rose to previous levels after a brief slump, which political observers mistakenly attributed to Trump’s statement that Prime Minister Narendra Modi had agreed to reduce India’s import of Russian oil in a calibrated manner. Trump had lied. Modi had given no such assurance to him.
• China: No significant reduction—it’s Russia’s top buyer, taking 45% of fossil fuel exports in Nov 2025 (though crude share dipped to 17.5%, a two-year low, due to quotas and alternatives). Imports remain high (~30% of Russia’s total exports), fuelled by discounts, showing the sanctions aren’t deterring Beijing much yet—perhaps due to its economic leverage and “no-limits” partnership with Moscow.
• Brazil: Imports from Russia (mostly diesel and other fuels) have declined in recent months (from the highs in mid-2025), but Russia still supplies ~60% of imported diesel, with total 2024-2025 imports ~$12B. Older US tariffs (40%) didn’t curb ties; instead, they may have strengthened Brazil’s resolve to diversify exports away from the US. No clear sign of major cuts due to the new bill yet.
  
  

Bottom line: Partial success in nudging India toward reduction, but China and Brazil continue largely unabated, sustaining Russia’s revenues. If enforcement ramps up, we might see more shifts, but circumvention (e.g., via intermediaries) or retaliation could blunt the impact.