As India and the United States inch closer to finalizing key trade deals, a sharp twist has emerged in the diplomatic narrative. The US rejected India’s move to impose retaliatory tariffs on American products, calling it “without basis” at the World Trade Organization (WTO).
At the heart of this trade row lies a fundamental disagreement over whether the US tariffs on steel and aluminum qualify as ‘safeguard measures.’ This term is a legal classification that holds global significance. But for India, this isn’t just about economics – it’s about asserting sovereignty in international trade rules. Bharat is demanding fairness from the US, which often plays by its own rulebook.
India’s Case: Calling Out Hypocrisy in Trade
India notified the WTO that it would impose retaliatory tariffs on 29 US products. These products ranged from apples and almonds to boric acid and steel items. All of them fall under the WTO’s Safeguards Agreement. So, why did India want to slap a tariff on them?
Because the US, citing national security, has slapped 25% duties on steel and 10% on aluminum imports.
India contends that this was effectively a safeguard measure, meant to protect domestic industry. As per global trade norms, if one country implements such measures, affected countries like India are allowed to retaliate after consultations. India even estimated the retaliatory tariffs could impact $7.6 billion worth of US imports. Bharat’s message was clear: we won’t be pushed around. However, trigger-happy Trump isn’t having it.
America’s Response: A Convenient Reframing
In its formal response to the WTO, the US shot down India’s claim. They insist that these tariffs weren’t safeguards at all, but national security actions under Section 232. This is a clever legal twist. Why? Because under WTO rules, ‘national security’ is a grey zone where member countries have more room to maneuver – and the US knows it.
Washington said bluntly: “We will not discuss Section 232 tariffs under the Agreement on Safeguards as we do not view the tariffs as a safeguard measure.”
Translation? The US is saying – “Our house, our rules.”
This is not the first time the US has weaponized the national security clause. Be it China, the EU, or now India – Washington routinely ducks accountability at the WTO by invoking Section 232. It’s a get-out-of-jail-free card that leaves developing economies stuck in procedural limbo.
India’s Tightrope Trade Walk: Deal or No Deal?
Here’s where things get complicated. Even as India pushes back at the WTO, it’s simultaneously in talks with the US to finalize a much-anticipated trade deal. Reports suggest the first phase could be wrapped up by early July. However, Trump and the US administration seem to be a little out of sync! Donald Trump is pushing Apple’s Tim Cook by proposing a 25% tariff on iPhones made outside the US.
Trump’s foot-in-the-mouth messiah complex made him spout nonsense regarding India’s military conflict with Pakistan.
Hence, the Indian regime comes to negotiations on trade deals fuming with anger and a deep mistrust at heart. India may no longer be happy with complying at all costs with the Trump regime. Bharat’s MEA is working hard to negotiate little to no impact on India’s own manufacturing interests.
So, India must balance two competing goals:
- Push back against unfair trade tactics
- Keep the larger bilateral trade deal from going off the rails
It’s a high-stakes diplomatic game, and India seems determined to play both sides with strategic finesse. But make no mistake – Delhi is clear that it will not let global powers redefine trade laws to suit their own agendas.
From WTO to Washington: India Must Hold the Line
This isn’t just a squabble over taxes or trade or tariffs on almonds or steel rods. This is a test of India’s resolve on the global stage. The WTO, already weakened by American non-cooperation, is becoming a courtroom where the powerful rewrite rules and the rest play catch-up.
By challenging the US at the WTO, India is asserting its right to be treated fairly under multilateral rules.
The fact that Washington has brushed aside New Delhi’s concerns underlines a growing divide – one where national interest often trumps global cooperation. India must now leverage its growing economic heft to ensure its voice isn’t sidelined. If the US expects India to be a partner in trade, defense, and tech, it must stop moving the goalposts in trade policy. This is not UPA-led 2005 India, this is the 4th largest economy of the world under Modi 3.0.
India’s fight against unilateralism is more than just diplomatic theatre—it’s a signal to the world that New Delhi won’t play second fiddle in the global economic order.
As analysts watch with weary eyes – the trade talks with the US continue. Bharat must use this crucial opportunity not only to push for better tariffs and trade deals. India needs to redefine the balance of power in global trade politics. Let the world know, Bharat’s growth story has just begun – and no tariff war can slow it down!