New Delhi [India]: India has officially informed the World Trade Organization (WTO) of its intention to impose retaliatory tariffs on select US imports, citing a loss of USD 1.91 billion due to America’s extended safeguard duties on steel, aluminium, and related products.
In a formal communication to the WTO’s Council for Trade in Goods, India invoked Article 8.2 of the Agreement on Safeguards (AoS) to notify its plan to suspend trade concessions and obligations vis-à-vis the United States.
India: US Duties Have Caused $1.91 Billion in Export Losses
According to the notice, the US safeguard measures have impacted approximately USD 7.6 billion worth of Indian exports, leading to additional duties valued at USD 1.91 billion.
“Accordingly, India’s proposed suspension of concessions would result in an equivalent amount of duty collected from products originating in the United States,” the note stated.
India argues that the US safeguard duties, though not formally notified to the WTO, are effectively functioning as such and are inconsistent with WTO rules, including the General Agreement on Tariffs and Trade (GATT) 1994.
Background: US Steel and Aluminium Tariffs Extended Again
The United States originally imposed 25% tariffs on steel and 10% on aluminium imports through Presidential Proclamations No. 9704 and 9705 on March 8, 2018.
- These measures were extended in January 2020.
- Most recently, they were renewed on February 10, 2025, via Presidential Proclamations No. 10895 and 10896, set to take effect March 12, 2025.
India’s Legal Stand: Lack of Consultation Breaches WTO Norms
India contends that no consultations have been held under Article 12.3 of the Agreement on Safeguards, which mandates dialogue before such duties are prolonged or modified.
In response, India is exercising its right to impose retaliatory tariffs under Article 12.5, which allows for the suspension of equivalent trade concessions if consultations are not offered.
Unless resolved diplomatically, these countermeasures could come into force by early June 2025.
Next Steps Depend on US Response
The ball is now in Washington’s court. A willingness to consult or withdraw the contested measures could prevent escalation. Otherwise, Indian retaliatory tariffs may take effect 30 days after notification.
This development marks a significant trade flashpoint between the two nations, potentially impacting bilateral trade at a sensitive geopolitical juncture.