Modi, Trump Hold First Call Since US Russia-Energy Tariff Law as Trade Deal Hangs in the Balance

Prime Minister Narendra Modi spoke to US President Donald Trump by phone on Wednesday evening, the first conversation between the two leaders since Washington armed itself with the power to slap tariffs of up to 100 per cent on countries that keep buying Russian oil and gas. India, one of the largest buyers of Russian crude, sits squarely in the path of that law.

Modi described the call as productive in a post on X, saying the two sides reviewed cooperation in trade, defence, energy, critical technologies and other areas, and agreed to stay in close contact to take the India-US Comprehensive Global Strategic Partnership forward. The leaders also discussed regional and international issues, including efforts to advance global peace and security. Officials indicated that the Indian side initiated the call.

The law hanging over the conversation

Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 on September 18, and it is due to take effect within 30 days of that date. Beyond widening sanctions on Russia's energy and defence sectors and its so-called shadow fleet of tankers, it gives the US president authority to impose steep tariffs on the biggest buyers of Russian energy, measured by volumes in the 12 months before enactment. We covered the bill's passage through Congress and India's exposure here.

The law does not name target countries and does not trigger a 100 per cent levy automatically. That leaves the White House room to decide who qualifies and at what rate, which is precisely why a leader-level conversation in the weeks before it kicks in matters for New Delhi. Modi's public readout did not say whether the legislation was specifically raised, and no US account of the call was immediately available.

India's position has been consistent. The Ministry of External Affairs has said the country will keep securing energy for its 1.4 billion people through diversified sourcing and market conditions, and that the potential fallout for both the bilateral relationship and global energy markets has been spelled out to US counterparts at senior levels.

Trade talks at a delicate point

The timing also overlaps with an active push on trade. Commerce and Industry Minister Piyush Goyal is in the United States from September 29 to October 5, attending the G20 trade ministers' meeting in Milwaukee and holding talks with US Trade Representative Jamieson Greer aimed at finalising an interim trade agreement. The two countries announced a framework for that deal on February 7, but it has yet to be signed.

External Affairs Minister S. Jaishankar said in New York earlier this week that the two sides had more or less reached an understanding, while acknowledging that shifts in the US tariff framework had complicated the timing.

Those shifts have been considerable. The US Supreme Court struck down Trump's so-called reciprocal tariffs in February, after India had faced a combined 50 per cent duty from August 2025, half of it tied to Russian oil purchases. That Russia-linked portion was withdrawn on February 7. In July, Washington imposed a separate 10 per cent Section 301 tariff on Indian goods following an investigation into forced-labour enforcement across 60 economies.

What to watch

The two leaders last met in person in June on the sidelines of the G7 summit in Evian, France. The near-term signals will come from Goyal's meetings with Greer this week and from how the White House chooses to apply the new sanctions law once it takes effect in mid-October. Any carve-out or delay for India would likely be tied to progress on the trade deal and to New Delhi's Russian crude intake in the months ahead.

This is an original summary based on public reporting. See our editorial policy for how we source, write, and correct our stories.