Tariff Reset: What Trump’s New 10% Global Duty Means for India

Within hours of the US Supreme court ruling the reciprocal and fentanyl-linked tariffs void, US President Donald Trump announced a temporary 10% tariff on imports from its trading partners.

The White House said this 10% tariff would apply to countries including India, even if they had earlier agreed to higher tariff rates under previous trade arrangements with the Trump administration.

These new tariffs have been introduced under Section 122 of the Trade Act of 1974. They will take effect from February 24, 2026 and will remain in place for up to 150 days.

This brief back and forth between the US administration and the judiciary has once again increased uncertainty in global trade.

SC Ruling Explained

On February 20, 2026, the US Supreme Court ruled 6–3 that Trump had exceeded his authority by using the International Emergency Economic Powers Act (IEEPA) of 1977 to impose broad reciprocal tariffs.

Writing for the majority, Chief Justice John Roberts said the emergency law does not give the president a power to impose wide-ranging tariffs without approval from Congress.

However, the ruling does not completely prevent tariffs. The Trump administration can still impose tariffs under other laws, but those require investigations, public explanations and apply only to specific sectors.

On the ruling, a Global Trade Research Initiative (GTRI) report prepared by Ajay Srivastav stated that it has abruptly reshaped the global trade environment.

“The decision effectively renders recent trade deals initiated or concluded by the United States with the UK, Japan, the EU, Malaysia, Indonesia, Vietnam and India one-sided and useless. Partner countries may now find reasons to dump these deals,” the report noted.

How Much Tariff Will India Face?

With reciprocal tariffs removed, about 55% of India’s exports to the US will no longer face the earlier 25% duty and will instead be subject only to standard Most Favoured Nation (MFN) tariffs.

However, some sector-specific tariffs will continue. These include 50% tariffs on steel and aluminium and 25% tariffs on certain automobile components under Section 232. At the same time, products such as smartphones, petroleum goods, and medicines, which make up about 40% of India’s exports, will remain exempt from US tariffs.

Technically, after the Supreme Court ruling, reciprocal tariffs imposed under emergency powers should not apply. But the White House has insisted trade partners to honor the agreements until new legal authority is used.

Therefore, it is yet unclear whether the new rate or rates agreed to in the trade deal will be applicable.

According to ANI, India will face the new 10% tariff until further notice as officials reportedly clarified that this new 10% tariff replaces the previously proposed 18% rate and will not be added on top of it.

India-US Tariff Timeline

Before April 2, 2025, the US applied only standard MFN tariffs on Indian goods. From April 2 to August 6, 2025, the US added a 10% reciprocal tariff.

This was increased to 25% between August 7 and August 26, 2025. From August 27, 2025, to February 6, 2026, the total additional duty rose to 50%. This included a 25% reciprocal tariff and another 25% penalty linked to India’s purchases of Russian oil.

From February 7 to February 24, 2026, the Russia-related penalty was removed, reducing the additional duty to 25%. A joint statement issued on February 6 proposed lowering the tariff to 18%, but this was never implemented.

Now, from February 24, 2026, a temporary 10% tariff will apply for 150 days, replacing the earlier reciprocal tariff system.

Impact on Trade

A report by Bank of America Global Research (BofA) stated the Trump administration announced new investigations under Sections 232 and 301, which could lead to more tariffs targeting specific industries rather than blanket tariffs.

This means sectors linked to national security could face higher risks, while consumer-focused industries may benefit.

The report added that the ruling will increase trade uncertainty, although less severely than previous disruptions. “For the outlook, the ruling and its aftermath will likely cause yet another uptick on traderelated uncertainty, though of smaller magnitude and shorter lived than what we saw last year. Part of the uncertainty lies in what could happen to bilateral trade deals,” it said.

Meanwhile, Gaurav Arora from Sahi said the shift could actually improve market stability. He explained that a clearer, rules-based tariff system reduces uncertainty, which investors prefer.

Arora added that stronger institutional checks mean tariff decisions may no longer depend entirely on presidential authority, which could create a more stable trade environment over time.

“For India, the impact remains balanced. While a uniform 10% tariff would apply equally to India, China, and others, the recent weakening of the rupee could partially offset the impact by enhancing export competitiveness. Overall, if executed as indicated, a more structured tariff regime may help calm global markets and curb excessive volatility, though implementation details will remain key,” he said.

What India Should Do Next?

The GTRI report stated India should reconsider its ongoing trade negotiations with the US. India had already offered several concessions, including reducing tariffs on US goods and promising to increase imports from the US, in return for an 18% tariff rate.

Now, even without such concessions, India faces a lower 10% tariff, the same as other countries, making the earlier negotiation less beneficial.

Importantly, the India-US joint statement signed on February 6, 2026, allows either country to change its commitments if tariff terms change. Since US tariffs have now been revised, India can use this clause to renegotiate the deal, delay it, or seek better terms to make the agreement more balanced and fair.

“The ruling should prompt India to re-examine its trade deal with the United States…. Now, even without a trade deal, India, like other countries, faces a 10% tariff on most goods, rendering the agreement being negotiated useless ... .India should use this clause to either opt out of the or delay negotiations or seek fresh terms so the trade deal looks equitable,” the report stated.