India needs an anti-sanctions law: At the BRICS Foreign Ministers’ Meeting in New Delhi on May 14, 2026, External Affairs Minister S Jaishankar criticised “unilateral coercive measures and sanctions” that are inconsistent with international law and the UN Charter. He said such measures hit developing countries disproportionately and cannot replace diplomacy.
The statement was not rhetorical flourish. India has faced the indirect costs of sanctions imposed by the United States and the European Union on Russia. These have not sanctioned India. Yet they have raised transaction costs, complicated energy payments, affected shipping and insurance, and created compliance risks for Indian firms dealing with Russian entities.
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Unilateral sanctions and India’s policy space
Sanctions are meant to influence state behaviour without war. The UN Charter gives the Security Council authority to use measures not involving armed force, including interruption of economic relations and communication links.
The problem lies elsewhere: in unilateral sanctions and their extraterritorial application. These are often shaped by geopolitical and techno-economic objectives. They force third-country firms to choose between domestic law, foreign market access, and financial-system exposure.
India has seen this through sanctions on Russia: exclusion from SWIFT, asset freezes, restrictions on shipping and insurance, and curbs on military-industrial entities. For Indian businesses, the effect is not theoretical. Payments take longer. Contracts become uncertain. Banks demand extra compliance. Energy imports require workarounds. Defence supply chains face delays.
Unilateral sanctions also compress sovereign policy space. Western-defined tests on governance, democracy, human rights, technology access, or security can become instruments of economic pressure. That sits uneasily with India’s stated commitment to strategic autonomy.
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Anti-sanctions law: What others have done
Several major powers have enacted legal shields against extraterritorial sanctions.
The European Union’s Blocking Statute, Council Regulation (EC) No 2271/96, prohibits EU operators from complying with specified foreign sanctions and allows recovery of damages caused by such measures.
Russia has used Article 248.1 of its Arbitrazh Procedure Code to give Russian courts jurisdiction in sanctions-linked disputes involving sanctioned Russian parties. The VTB-JPMorgan litigation shows how such provisions can be used when funds are frozen abroad. A Russian court ordered seizure of $155.8 million in JPMorgan Chase funds in 2024 in a dispute over blocked VTB assets.
China has gone further. Its Anti-Foreign Sanctions Law allows countermeasures against individuals and entities involved in measures Beijing sees as discriminatory. In 2025, China strengthened implementation rules. In 2026, it invoked anti-sanctions law against US measures targeting Chinese refiners.
These laws are not merely commercial shields. They assert judicial and regulatory sovereignty.
India’s sanctions framework is fragmented
India does not have a comprehensive autonomous sanctions regime. UN sanctions are implemented through the United Nations (Security Council) Act, 1947. Other restrictions flow through the Foreign Exchange Management Act, the Foreign Trade (Development and Regulation) Act, the Unlawful Activities (Prevention) Act, and allied instruments.
This framework works for UN obligations and selected domestic restrictions. It is not designed for secondary sanctions or foreign coercive measures aimed at third-country entities.
A dedicated Indian anti-sanctions law could do three things. It could bar enforcement of specified foreign sanctions in India. It could allow Indian entities to claim damages in Indian courts. It could give the government a structured basis to grant exemptions where energy security, defence, pharmaceuticals, agriculture, or financial stability require flexibility.
That last point is crucial. A blunt statute would damage India’s own interests.
Anti-sanctions law needs caution
India is not China. Nor is it the EU. Countries with deep manufacturing leverage and large domestic markets can absorb retaliation better. India’s position is improving, but its firms remain exposed to dollar finance, Western technology, global investors, and cross-border contracts.
The Hurun Global Unicorn Index 2024 showed India had 67 unicorns at home, while Indian founders had co-founded 109 unicorns outside India. Much of that offshore formation was in the United States.
That is a warning. If regulation becomes unpredictable, more firms will incorporate abroad. An anti-sanctions law should not become another reason to move holding companies, intellectual property, or financing structures outside India.
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Anti-sanctions law: The Indian design
India should begin with coalition-building. BRICS+, Global South partners, and other affected economies should work on reciprocal legal and financial arrangements. Collective action reduces the cost of retaliation.
It should create institutional capacity first. A sanctions response cell under the Ministry of External Affairs and the Ministry of Finance can track exposure, issue guidance, coordinate with regulators, and advise firms before disputes arise.
The legal architecture should be narrow. It should prohibit enforcement of notified foreign sanctions within Indian jurisdiction. It should permit damages claims. It should protect critical sectors. It should provide clear exemptions. It should avoid vague criminal exposure for ordinary commercial decisions.
The financial architecture must also improve. India needs more resilient payment channels, stronger rupee-settlement mechanisms, central-bank coordination, and alternatives to vulnerable financial messaging systems. Any such effort must preserve anti-money laundering and counter-terror financing standards.
Compliance should be light. Reporting must be simple. Implementation should be phased. Firms should not be punished for legacy contracts or unavoidable exposure to foreign law.
Strategic autonomy needs legal preparation
Sanctions are now a routine instrument of statecraft. They are no longer exceptional tools. For India, defensive legislation is becoming necessary.
But the choice is not between passivity and overreaction. India needs a law that protects sovereign decision-making without frightening capital, burdening exporters, or accelerating business flight.
The BRICS meeting has given New Delhi a useful opening. India should use it to shape norms on sovereign equality and economic coercion. It should also prepare at home with care. A well-designed anti-sanctions framework would strengthen strategic autonomy. A hurried one would weaken it.
Shrijeet Phadke is a lawyer and policy researcher based in Mumbai.