In a significant development in international trade relations, India has notified the World Trade Organization (WTO) of its intention to impose retaliatory tariffs on certain U.S. products. This move comes as a direct response to the United States’ decision to extend 25% tariffs on steel and aluminum imports, a measure that affects approximately $7.6 billion worth of Indian exports.
Background: U.S. Tariffs on Steel and Aluminum
The U.S. administration, under President Donald Trump, reinstated 25% tariffs on steel and aluminum imports in March 2025, citing national security concerns. These tariffs, initially introduced in 2018, have been a point of contention between the two nations. India, as the world’s second-largest producer of crude steel, has expressed concerns over the adverse impact of these duties on its exports and domestic industry.
India’s Response and WTO Notification
In a formal submission to the WTO dated May 9, 2025, and circulated on May 12, India outlined its plan to suspend certain trade concessions and impose higher duties on selected U.S. products. While the specific products targeted have not been disclosed, the proposed countermeasures are estimated to result in $1.91 billion in additional duties, aligning with WTO provisions that allow for such actions in response to safeguard measures.
Implications for Indo-U.S. Trade Relations
This development occurs amidst ongoing negotiations between India and the United States aimed at finalizing a bilateral trade agreement. India’s Commerce and Industry Minister, Piyush Goyal, is scheduled to lead a delegation to Washington on May 16, 2025, to advance these discussions. The proposed retaliatory tariffs may add complexity to the negotiations, potentially affecting the trajectory of the trade deal. Reuters
Conclusion
India’s decision to propose retaliatory tariffs underscores the escalating trade tensions between the two nations. As both countries navigate these challenges, the outcomes of the forthcoming trade talks will be pivotal in shaping the future of Indo-U.S. economic relations.
