Sanctions 2026

INDIA Law and Practice Contributed by: Ayush Mehrotra, Upkar Agrawal and Varsha Goel, Khaitan and Co

Khaitan and Co 8th Floor, Godrej GCR Building Golf Course Road Sector 42, Gurugram – 122 002 India Tel: +91 124 659 1000 Email: ayush.mehrotra@khaitanco.com Web: www.khaitanco.com

1. Trends and Overview 1.1 Sanctions Market

Additionally, Indian businesses are facing increas - ing pressure from US secondary sanctions targeting countries purchasing Russian oil and gas. In Octo - ber 2025, the US Treasury’s Office of Foreign Assets Control (OFAC) sanctioned 21 Indian entities (19 companies and 2 individuals) for links to the Russian Government. The European Union’s (EU) sanctions packages have also extended restrictive measures to select Indian companies with Russian ties in mid-2025 and, more recently, in June 2026. The EU’s 18th and 21st sanctions packages directly designated Indian entities on the EU asset freeze list. Further, in October 2025, the United Kingdom desig - nated Indian refiners/port operators tied to Russian supply chains as sanctioned entities. These designa - tions have created new commercial and compliance challenges for Indian businesses that have historically operated outside the direct reach of foreign sanctions regimes. Overall, the sanctions domain has expanded materially in both scope and complexity over the past 12 months, placing sanctions compliance firmly at the centre of corporate governance and cross-border Geopolitical dynamics have become a key determi - nant of corporate strategy, rather than a secondary consideration. Trade sanctions, in particular, have gained prominence in boardroom and governance conversations over the past 12 months. This is pri - marily due to increasing geopolitical uncertainties and evolving requirements to comply with international obligations and national security. The key trends we are witnessing have been outlined below. statecraft strategy. 1.2 Key Trends

India’s sanctions landscape has undergone signifi - cant transformation in the last 12 months. The most notable development is India’s first autonomous trade sanction on Pakistan, prohibiting all direct and indirect imports or transit of goods originating in or exported therefrom, with immediate effect, citing national secu - rity and public policy. This marks a decisive departure from India’s traditional posture of implementing only United Nations Security Council (UNSC) mandated sanctions and signals a willingness to deploy trade restrictions as an instrument of bilateral statecraft. The Indian Government also implemented the UNSC resolution changes in the past year, including amend - ments relating to travel bans, asset freezes, arms embargoes and adding individuals and entities to sanctioned lists concerning Sudan, the Democrat - ic Republic of Congo, Libya, Haiti, Iraq and Yemen through corresponding updates in the national leg - islation. In March 2023, the Indian Government mandated reg - istration for virtual digital asset (VDA) service provid - ers, including overseas operators under the Prevention of Money Laundering Act, 2022 (PMLA). In the past year, the Financial Intelligence Unit – India (FIU-IND), the enforcement agency under PMLA, has increased vigilance by initiating enforcement action against non- compliant offshore VDA platforms, including issuing compliance notices to entities operating in India with - out registration.

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