Introductory Memo
The United States (US) freezing USD 300 billion in Russian reserves in 2022 in the context of the Russia-Ukraine conflict was part of a bigger story. The US has applied comprehensive sanctions on Iran, Cuba, North Korea, Venezuela and the Syrian Arab Republic. It has applied broader economic restrictions on Russia and Belarus. It has deployed extensive tariffs against China, India, the European Union (EU) and many other countries. The US uses tariffs to fulfill its foreign policy choices like it did when it imposed an additional 25% duty on India in 2025 for buying Russian oil. Together, sanctions and tariffs are weapons of an economic power system. No single country barring the US has wielded these before, at least post World War-II. It is important to understand how this system works, why it is beginning to come under strain, and how India and others are responding to it.