US President Trump insists that the India-US interim trade arrangement remains intact with India continuing to pay tariffs while the United States does not, even after a Supreme Court ruling struck down key elements of his broader tariff regime.
US President Trump reiterated that the interim trade framework with India remains “on” following a sweeping Supreme Court decision that struck down large parts of his tariff authorities.
He told reporters at the White House that existing tariff terms – under which India pays duties on American imports while the US pays none will continue as agreed in the interim deal, describing the arrangement as “fair” and crediting Prime Minister Narendra Modi for securing it.
Trump’s comments come in the wake of a landmark 6-3 Supreme Court ruling that declared his use of the International Emergency Economic Powers Act (IEEPA) to impose broad tariffs unconstitutional, limiting presidential unilateral tariff powers.
While the court’s verdict invalidated much of the earlier tariff structure, the President stated he will implement a 10 per cent global tariff under an alternative legal provision (Section 122 of the Trade Act of 1974) to maintain trade leverage.
The White House also confirmed that India will pay the 10 per cent tariff while the US will not, preserving the basic structure of the interim agreement. A senior administration official told ANI that India’s tariff obligations would continue under the new authority until further arrangements are negotiated.
Interim Framework and Legal Upheavals Reshape Trade Reality
The India-US trade relationship has undergone rapid shifts in recent months. Early in February, both nations announced a framework for an interim trade agreement aimed at reducing tariff barriers and stabilising commercial ties after years of mounting tensions.
Under this framework, the US cut reciprocal tariffs on Indian goods (which had been as high as 25–50 per cent) to around 18 per cent, with the agreement expected to be signed and operationalised by April or March.
However, the US Supreme Court’s rejection of Trump’s tariff strategy upended much of this context: the court ruled that the President lacked authority under IEEPA to impose broad peacetime tariffs. This threw legal uncertainty over tariff collections and prompted immediate administrative action to reframe duties under Section 122.
Analysts say the legal revamp means tariffs once set under Trump’s emergency powers are no longer valid, potentially opening the door for refund claims and requiring fresh legislative validation if broader tariff strategies are to be sustained.
Despite this, the 10 per cent tariff regime will temporarily fill the gap, keeping India’s export costs elevated while negotiations on a more comprehensive pact continue.
India’s Position and Broader Diplomatic Context
New Delhi has so far maintained that the interim agreement with Washington represents incremental progress rather than a full-blown pact. Officials have highlighted that trade talks are ongoing and should ultimately protect Indian industries while expanding access to US markets.
The interim framework is largely seen as a step towards a wider Bilateral Trade Agreement (BTA), expected to encompass digital trade, services and other sectors beyond mere tariff schedules.
Indian authorities have not formally endorsed Trump’s broadcasts of “flips” or dramatic tariff reversals. Instead, commerce and trade representatives emphasise continuity, predictability and negotiated terms as key priorities especially given the strategic backdrop that ties the two democracies together on security, technology and supply chains.
This includes India’s recent participation in the US-led Pax Silica initiative, which aims to build secure technology value chains among allied nations.
Economists note that while easing punitive tariff rates offers exporters relief, remaining duties under Section 232 (national security tariffs on steel and aluminium, for example) and the new global tariff mean Indian goods will still face higher costs in the US market.
Trade think tanks have urged New Delhi to reassess its negotiating approach and guard its strategic autonomy amid shifting policy winds in Washington.
The Logical Indian’s Perspective
The recent developments illustrate the complex interplay of law, politics, and diplomacy in shaping global trade. Leaders often frame outcomes in competitive terms talking of “flips,” victories, or concessions but the real long-term value lies in mutual understanding and predictability that benefits ordinary people, producers and consumers on both sides.
Trade policy cannot be reduced to triumphal soundbites about who pays what tariff. In an interconnected world, collaborative engagement, transparency and respect for legal and democratic processes are vital if nations are to address shared challenges like supply chain resilience, technology cooperation and climate transition.
