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Supreme Court Nullifies Trump’s Global Tariffs, Prompting 10% Surcharge and Indian Review

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Court’s 6‑3 Ruling Declares Trump Tariffs Unlawful The U.S. Supreme Court held on Feb 20 2026, in a 6‑3 opinion authored by Chief Justice John Roberts, that President Donald Trump exceeded authority under the International Emergency Economic Powers Act when imposing worldwide tariffs, thereby striking down the levies on the United Kingdom, Japan, the EU, Malaysia, Indonesia, Vietnam and India [1][2][3][5][6]. The decision emphasizes that only Congress may impose taxes, a point reiterated by the Court’s majority [5][6]. Economists estimate up to $175 billion in previously collected duties could be refundable [1].

Trump Announces 10% Global Surcharge Effective Feb 24 President Trump issued a proclamation on Feb 20 ordering a 10 % ad valorem import surcharge on all goods entering the United States for 150 days, to begin on Feb 24 2026 [1][2][4][6]. He framed the measure as a “temporary import surcharge” and linked it to Section 122 of the Trade Act of 1974, a provision never before used for a worldwide rate [4][6]. Treasury Secretary Scott Bessent hinted that the same tariff level could be applied “in a less direct and slightly more convoluted manner,” suggesting alternative implementation paths [4].

India’s Commerce Ministry Monitors Fallout While Opposition Calls Deal Pause The Indian Ministry of Commerce & Industry said on Feb 21 it is studying the Court’s judgment and Trump’s surcharge for implications on the interim India‑U.S. trade agreement [1][2]. The interim pact, announced on Feb 2, reduced reciprocal tariffs on Indian goods from 25 % to 18 % but still requires India to pay duties while the U.S. pays none [5][6]. Congress leaders Jairam Ramesh and Rahul Gandhi demanded a hold on the deal, arguing it harms farmers and compromises sovereignty [1][5].

Existing 50% Steel and Aluminium Duties Remain Unchanged Despite the Court’s ruling, the United States continues to levy 50 % tariffs on steel and aluminium under Section 232 of the Trade Expansion Act, affecting Indian exporters in those sectors [3][4]. Section 301 investigations against India are dormant, with the last probe concluding in 2020 over a digital services‑tax dispute [4]. Analysts warn that Section 232 could still be used to target additional Indian products, underscoring the need for India to reassess the interim agreement [3][4].

Market Reaction Shows Modest Gains and Refund Expectations U.S. stock indices rose modestly after the decision, reflecting investor optimism that inflation pressure may ease without the disputed tariffs [1]. Economists at the Penn‑Wharton Budget Model project that billions of dollars in tariff collections could be returned to importers, potentially reshaping trade cash flows [1].

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Timeline

July 30, 2025 – The United States imposes a 25 % reciprocal tariff on Indian imports, targeting labor‑intensive goods such as apparel, gems, jewellery and seafood, marking the first major trade penalty against India in the Trump administration [21].

August 27, 2025 – The U.S. expands the tariff on Indian goods to 50 % via an executive order, intensifying pressure on Indian exporters and signaling a hardening U.S. stance ahead of any bilateral agreement [21].

August 15, 2025 – Prime Minister Narendra Modi publicly pledges to protect Indian farmers, a promise later invoked by farmer groups as evidence that the February 2026 trade deal betrays that commitment [14].

December 2025 – Indian steel and aluminium shipments to the United States plunge 66 % after the high tariffs take effect, underscoring the economic impact of the 50 % duties on a key export sector [5].

January 5, 2026 – President Donald Trump claims on Truth Social that U.S. tariff receipts will exceed $600 billion, framing the tariffs as a source of national strength and security [19].

January 6, 2026 – Speaking at a GOP retreat, Trump says Prime Minister Modi “is not that happy” with the U.S. tariffs tied to India’s Russian‑oil purchases, while asserting that India has “reduced it very substantially” [18].

Early February 2026 – The European Union and India sign a free‑trade agreement expected to double EU exports to India by 2032, a move that prompts Washington to act before being outflanked [1].

February 2, 2026 – President Trump announces a surprise U.S.–India trade deal that cuts U.S. tariffs on Indian goods from 50 % to 18 % and removes the 25 % penalty linked to Russian‑oil imports; Modi hails the cut as a win for 1.4 billion Indians, while U.S. Ambassador Sergio Gor tweets “STAY TUNED” indicating top‑level coordination [2][17].

February 2, 2026 – External Affairs Minister S. Jaishankar arrives in Washington for a three‑day visit that includes the Critical Minerals Ministerial, aimed at securing supply‑chain resilience and clean‑energy cooperation [17].

February 3, 2026 – White House Press Secretary Karoline Leavitt states that India will cease purchasing Russian oil and will commit $500 billion to U.S. investment across transportation, energy and agriculture, while the U.S. tariff on Indian goods drops to 18 % [12].

February 4, 2026 – Sharad Pawar warns that the new U.S. tariff framework allowing American farm products into India could threaten Indian farmers, and says a detailed picture of the agreement will emerge within 48 hours [11].

February 5, 2026 – Trump declares a historic India‑U.S. trade framework, reiterating the 18 % tariff cut, the $500 billion import commitment, and zero U.S. duties on Indian exports, while Agriculture Secretary Brooke Rollins touts massive farm‑product imports to boost rural America [10].

February 20, 2026 – The U.S. Supreme Court, in a 6‑3 decision, blocks Trump’s worldwide tariffs as exceeding authority under the International Emergency Economic Powers Act, invalidating the global levy and affecting deals with India and other partners [6][9].

February 20, 2026 – Trump announces a “temporary import surcharge of 10 % ad valorem” on all imports, to take effect on February 24 and last 150 days, as a workaround to the Court’s ruling [9][5][6].

February 21, 2026 – India’s Ministry of Commerce & Industry says it is studying the Supreme Court judgment and the President’s 10 % surcharge for its impact on the interim India‑U.S. trade agreement [7].

February 21, 2026 – Opposition leaders Jairam Ramesh and Rahul Gandhi accuse Modi of compromising Indian sovereignty and betraying farmers by sealing the interim deal before the Court’s decision [8].

February 21, 2026 – Trump says he will explore “other alternatives” after the Court blocks his emergency‑powers tariffs, and Treasury Secretary Scott Bessent hints at applying the same 10 % level “in a less direct and slightly more convoluted manner” [4].

February 23, 2026 – An Indian delegation is scheduled to meet U.S. counterparts to finalize the first phase of the bilateral agreement that earlier in February reduced tariffs to 18 % and recorded $186 billion in bilateral trade for 2024‑25 [7].

February 24, 2026 – The 10 % global surcharge officially begins, adding to existing Most‑Favoured‑Nation duties on Indian products and remaining in force for 150 days, while Section 122 of the Trade Act provides the legal basis [5][9].

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