India to Stay the Course on US Trade Talks After Supreme Court Strikes Down Trump’s Tariffs

The proposed 18% reciprocal tariff on Indian exports to the United States may now be overtaken by events following the US Supreme Court’s recent ruling, but both countries remain engaged in efforts to finalise a “mutually beneficial” interim trade agreement, according to people familiar with the discussions.

For India, the earlier reciprocal tariff structure has effectively been replaced by a revised framework. After the court struck down the legal basis for higher levies, President Donald Trump announced a uniform 15% tariff on imports from all trading partners, raising it from the 10% rate introduced less than a day earlier. This new tariff applies in addition to existing product-specific most-favoured nation (MFN) rates.

Officials indicated that the combined 15% plus MFN structure now represents the default tariff regime. Any preferential arrangement for India, they said, would ideally involve adjustments to ensure Indian goods remain competitive relative to other major exporters such as China, Bangladesh, Vietnam, Cambodia and Indonesia.

The February joint statement between India and the US explicitly allows for such recalibration. It notes that if either country modifies agreed tariff levels, the other may revise its commitments accordingly.

While the ministries of commerce and external affairs did not comment directly, India’s commerce ministry said it was reviewing the implications of the Supreme Court decision and subsequent announcements by the US administration.

Negotiations over the interim bilateral trade agreement (BTA) were already under way, though the legal text had not yet been finalised. An Indian delegation was scheduled to travel to Washington for further discussions ahead of a possible signing during an anticipated visit by US Trade Representative Jamieson Greer.

Despite lingering uncertainty, trade experts expect greater clarity soon. US Treasury Secretary Scott Bessent signalled that the administration intends to rely on alternative legal authorities — including Sections 232, 301 and 122 of US trade law — to sustain its tariff strategy.

The ruling carries wider global implications. Analysts say it limits the executive branch’s ability to impose tariffs without clear statutory grounding, potentially restoring greater predictability to international trade. It may also open the door to refund claims from importers who paid duties under the invalidated measures.

Indian exporters have reacted cautiously. Industry bodies welcomed the removal of reciprocal tariffs but warned that the new tariff environment still presents challenges. Labour-intensive sectors, particularly textiles, remain concerned about continued volatility in the US — India’s largest merchandise export market.

Others, including the gems and jewellery sector, described the changes as a relief, saying they could ease pressures created by earlier, steeper duties.

Overall, policymakers and businesses on both sides are closely watching developments, with expectations that ongoing negotiations will help stabilise trade terms under the evolving tariff regime.