India and the US Discuss Energy and Defence Ties as Trade Deal Nears Completion
The US Secretary of State held talks with India's External Affairs Minister in Mumbai on 20 October 2026. This is his second official visit to India in 2026; the trip also includes a stop at Jamnagar in Gujarat, home to one of the world's largest oil refineries.
The two sides discussed energy security and defence cooperation, and reaffirmed the importance of the India-US strategic partnership.
The US side said the India-US trade deal is "very close", with only a small number of items left to settle. No agreement has been signed yet.
The visit comes after a new US law, the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026 (signed on 18 September 2026), allowed extra US tariffs of up to 100% on goods from countries that are big buyers of Russian oil and gas. On 16 October 2026, the US President temporarily waived these Russia-linked tariffs and sanctions, with a review over the following 60 days.
India's position is that its oil purchases are needed for its own energy security and for stable world oil markets. The US side noted that India has made "substantial progress" in diversifying where it buys energy from, and wants India to buy more US energy.
India-US Bilateral Trade Agreement (BTA)
The India-US Bilateral Trade Agreement (BTA) is a trade deal that India and the United States are negotiating. Its aim is to make it cheaper and easier for each country to sell goods and services to the other, by cutting import taxes (tariffs) and removing other trade barriers. The US is one of India's largest trading partners and its biggest export market, so the terms of this deal matter a lot for Indian exporters and jobs.
The talks in Mumbai pushed the trade deal close to the finish line. Settling it would also lower the risk of new tariffs linked to India's Russian oil purchases.
Economic Sanctions: Primary vs Secondary Sanctions
Economic sanctions are penalties that one country puts on another to force it to change its behaviour, using trade and money instead of weapons. Primary sanctions stop a country's own people and companies from dealing with the target (for example, US firms cannot deal with a sanctioned Russian bank). Secondary sanctions go further: they punish third countries or their companies for dealing with the target. India is not the target, but it can be hit as a buyer of Russian oil.
The Act is a clear example of secondary sanctions: it threatens tariffs on India for buying from Russia, not for anything India does against the US. The waiver has given space for the trade and energy talks seen during this visit.
India's Energy Security and Import Dependence
Energy security means a country can always get the energy it needs, at a price it can afford. For India, the biggest part of this problem is oil, because India imports close to nine out of every ten barrels of crude oil it uses. So sanctions, wars or price spikes far away can quickly raise fuel prices at home and hurt the economy.
Energy security sits at the centre of this visit. India defends its oil purchases as necessary for its people, while the US wants India to diversify further, ideally towards American energy.
- India-US talks held in Mumbai on 20 October 2026; visit also covers Jamnagar, Gujarat
- Second official visit of the US Secretary of State to India in 2026 (the first was in May)
- Lindsey O. Graham Sanctioning Russia and Iran Act of 2026: signed 18 September 2026 (H.R. 5334)
- Section 113: extra duty of up to 100% on goods from covered countries buying Russian energy
- Iran Sanctions Act of 1996 extended to 2031
- Waiver of Russia-linked tariffs and sanctions: 16 October 2026, followed by a 60-day review
- February 2026 interim framework lowered US tariffs on Indian goods (reported rate: 18%)
- Indian goods exports to the US: about USD 8.3 billion in August 2026, up about 21% year on year