Trump tariffs: India and US defer trade deal talks after Supreme Court ruling - BBC

Importers and trade compliance professionals should note that trade deal talks between India and the United States (US) have been deferred this week. This postponement follows a recent US Supreme Court ruling that upheld the legality of the "Trump-era" Section 232 tariffs on steel and aluminum. The deferral of these crucial discussions means that the existing tariff landscape, which has been a point of contention between the two nations, will remain unchanged for the foreseeable future.

The tariffs in question originated in 2018 when the US imposed duties of 25% on steel and 10% on aluminum imports under Section 232 of the Trade Expansion Act of 1962, citing national security concerns. In retaliation, India implemented its own tariffs in 2019 on 28 specific US products. These retaliatory tariffs from India impact a range of agricultural goods, including prominent US exports such as almonds, walnuts, and apples. The now-deferred trade deal talks were widely anticipated to address and potentially resolve these tariff disputes, with expectations that India's retaliatory tariffs would be removed as part of an agreement.

As a direct consequence of the deferral, the tariffs imposed by both countries will continue to apply. This means that US importers of steel and aluminum will continue to face the 25% and 10% duties, respectively, which were originally put in place in 2018. Similarly, US exporters of the 28 products targeted by India, including almonds, walnuts, and apples, will continue to contend with India's retaliatory tariffs, first imposed in 2019. The recent US Supreme Court ruling, which affirmed the legality of the Section 232 tariffs, appears to have contributed to the current impasse, impacting trade relations between the two countries.

What Importers Should Do:

Given the ongoing situation, importers and trade compliance officers are advised to:

• Monitor Developments: Stay informed about any future announcements regarding trade talks between India and the US, as the situation could evolve.
• Review Supply Chains: Assess the impact of continued tariffs on your current supply chains, particularly if you import steel or aluminum into the US, or export affected agricultural products to India.
• Ensure Compliance: Continue to ensure full compliance with all existing tariff regulations and customs requirements for affected goods.
• Consider Duty Mitigation: Explore potential duty mitigation strategies, where applicable and legal, to manage the financial impact of these tariffs.