India-US Trade Ties Remain Unsettled Over Graham Bill, Finance Ministry Says
India-US trade relations remain uncertain following the passage of the Graham Bill by the US Congress and its subsequent approval by the US President, the Finance Ministry said in its September Monthly Economic Review. The Lindsey O Graham Sanctioning Russia and Iran Act of 2026 seeks to increase pressure on countries purchasing oil from Russia and Iran by allowing the US administration to impose…
The Finance Ministry of India has expressed concerns over the recently passed Graham Bill in the US Congress and its approval by the US President. The Lindsey O Graham Sanctioning Russia and Iran Act of 2026 aims to intensify pressure on nations purchasing oil from Russia and Iran by permitting the US administration to impose tariffs of up to 100% on importers of Russian crude. This development adds to the existing trade uncertainties for India as global investment flows are influenced by various factors.
Despite the backdrop of a booming artificial intelligence investment and cross-border flows, no signs of a slowdown in capital expenditure are evident. Developed economies are vying to attract investment to boost renewed manufacturing expansion, while global supply chains face growing geopolitical pressures. For India and other developing economies, this situation creates a more challenging environment for attracting foreign capital.
The ministry forecasts that net foreign direct investment into India will perform better during the current financial year compared to the previous year. However, it also warns that Indian financial assets, including the rupee, may experience short-term pressure due to ongoing geopolitical and economic uncertainties. The ministry emphasizes that India cannot solely depend on the growth witnessed post-pandemic and must sustain economic performance through continued policy efforts.
The Graham legislation is particularly significant for India as the country continues to import Russian crude oil. Finance Ministry's assessment was revealed following a meeting between Commerce and Industry Minister Piyush Goyal and US Trade Representative Jamieson Greer during the G20 Trade Ministers Meeting in Milwaukee. The two sides discussed efforts to finalize an interim trade agreement under the proposed India-US Bilateral Trade Agreement.
They also exchanged views on issues being deliberated under the G20 framework during the US presidency.
The latest discussions come as India strives to manage trade and investment uncertainties while ensuring energy security and attracting foreign capital.
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