India Should Wait for Court Verdict Before Finalizing Trade Deal: GTRI

 Chennai: India should wait for the US Supreme Court’s decision on the tariffs before signing the deal, finds GTRI.

The top court of the US is hearing the petitions on the case whether President Donald Trump has the authority under the International Emergency Economic Powers Act (IEEPA) to impose tariffs.

Several justices questioned whether the law allows such sweeping powers. If the Court rules against Trump, the duties would be declared illegal and withdrawn, potentially reshaping global trade and directly affecting US-India negotiations

“It may uphold earlier rulings and strike down the tariffs. If that happens, India will be in a much stronger position to pursue a fair, forward-looking trade deal with the US, free from the pressure of unilateral duties,” finds GTRI.

India should first complete its exit from sanctioned Russian oil, then secure a rollback of the 25 per cent penalty tariff to restore competitiveness and then resume balanced trade negotiations with the US on equal terms.

Trump has already acknowledged that India has largely stopped oil imports from sanctioned Russian firms. With Russian oil imports curtailed, India should press Washington to withdraw the 25 per cent “Russian oil” tariff. This would reduce the overall US duty burden on Indian goods from 50 per cent to 25 per cent, boosting competitiveness in sectors like textiles, gems and jewellery, and pharmaceuticals without rushing into a full trade deal.

Once duties are rolled back, India should restart talks for a balanced trade agreement, aiming for parity with partners like the EU and targeting average industrial tariffs of about 15 per cent.