Indian exporters face a shifting landscape as US tariffs are set to drop to 10% following a Supreme Court ruling, but uncertainty lingers over potential increases and long-term trade implications.
Photograph: Mike Blake/Reuters
Key Points
- US tariffs on Indian exports will decrease to 10% for 150 days following a US Supreme Court ruling against the Trump administration’s initial tariffs.
- Uncertainty remains among Indian exporters due to potential increases in US tariffs to 15% and a lack of clarity on long-term trade policies.
- The reduced tariffs are expected to improve visibility for global footwear and leather sourcing, benefiting Indian manufacturers with competitive labor and manufacturing capacity.
- The US remains a key export destination for India, with bilateral trade totaling $186 billion in 2024-25, making tariff clarity crucial for sustained export growth.
- A framework for an interim trade deal between India and the US is in progress, aiming to further reduce tariffs and solidify trade relations.
Indian exports to the US will attract an additional 10 per cent tariff against 25 per cent currently for 150 days starting Tuesday after the American Supreme Court struck down the Trump administration’s sweeping tariffs.
Exporters, however, said there is uncertainty among the trading community as US President Donald Trump has announced a hike in tariffs to 15 per cent, though no official order has been issued in this regard.
Following a Supreme Court verdict against his earlier sweeping tariffs last week, Trump on February 21 imposed a 10 per cent tariff on all countries, including India, from February 24 for 150 days.
Within hours of issuing this order, Trump announced a hike in tariffs to 15 per cent.
“As per the current order, Indian goods will attract 10 per cent tariffs from February 24. But we are keeping our fingers crossed, as a new order for 15 per cent tariffs has not been issued by the US so far.
But uncertainty is there,” Federation of Indian Export Organisations (FIEO) Director General Ajay Sahai said.
There is also confusion over these tariffs, as there is no clarity on what will happen after 150 days.
“We need to bring down the curtains on this tariff drama now,” Mumbai-based exporter and founder chairman of Technocraft Industries India Sharad Kumar Saraf said.
Saraf said the US is a key export destination for Indian exporters, and uncertainties over these import duties impact the sentiments of businesses.
“Clarity and certainty over these tariffs will help us in pushing exports to the US,” he added.
The 10 per cent levy will be over and above the existing MFN (most favoured nation) or import duties in the US.
For instance, if a product faces a 5 per cent MFN duty, an additional 10 per cent will be imposed, taking the effective duty to 15 per cent.
Earlier, this was 5 plus 25 per cent. If 15 per cent will be notified, then the duty will be 5 plus 15 per cent.
Impact on Footwear and Leather Industries
Leading footwear exporter and Florence shoe company chairman Aqeel Panaruna said that recent clarity provided by the US Supreme Court ruling on tariff application has improved visibility for global footwear and leather sourcing, with effective duties now expected to fall in the 10â 15 per cent range.
He said the ruling applies uniformly across Asian sourcing countries, helping restore predictability for US brands.
“For the footwear and leather industry, one of the most labour-intensive and service-driven global manufacturing sectors, tariff stability is critical. Long product-development cycles, tight margins, and complex supplier coordination require predictable landed costs and reliable execution,” Aqeel said.
Within this framework, he said, India remains a competitive sourcing destination.
Its large, skilled workforce, expanding manufacturing capacity, and standards allow suppliers to meet US buyers’ requirements on quality, delivery timelines, and flexibility, even in a changing trade environment, he added.
“Footwear manufacturing is no longer driven by cost alone. Service reliability, workforce continuity, and long-term supplier relationships are increasingly central to sourcing decisions.
“India’s ability to provide consistent labour availability and scalable production helps reduce supply-chain risk for US brands,” Aqeel noted.
As US brands reassess global sourcing strategies, India’s competitiveness positions it as a strong partner for future growth in footwear and leather manufacturing, he said.
Seafood Exports and Overall Trade Relations
Yogesh Gupta, MD of Kolkata-based Megaa Moda and a major processor and exporter of seafood products, said that the reduction in the reciprocal tariffs to 10 per cent will help us increase shipments in the American markets.
The removal of the 15 per cent uncertainty will give a clearer picture to exporters, he added.
In a major setback to Trump’s pivotal economic agenda in his second term, the US Supreme Court last week ruled that the tariffs imposed by Trump on nations around the world were illegal and that the president had exceeded his authority when he imposed the sweeping levies by using the International Emergency Economic Powers Act (IEEPA) of 1977.
The US had imposed a 25 per cent reciprocal tariff on India in August 2025.
Later, an additional 25 per cent duty was imposed for buying Russian crude oil, taking the total tariffs on India to 50 per cent.
India and the US, earlier this month, agreed on a framework to finalise an interim trade deal, under which Washington will cut down the tariffs to 18 per cent. So far, the punitive 25 per cent has been removed. The remaining 25 per cent exists.
To sign and implement the first phase of the bilateral trade agreement, the framework has to be converted into a legal document.
To finalise the legal text for the first phase of the bilateral trade agreement, an Indian team was scheduled to meet its counterparts in Washington from February 23-26, 2026. But this visit has now been postponed.
During 2021-25, the US was India’s largest trading partner in goods.
The US accounts for about 18 per cent of India’s total exports, 6.22 per cent of its imports, and 10.73 per cent of its bilateral trade.
In 2024-25, bilateral trade totalled $186 billion ($86.5 billion in exports and $45.3 billion in imports).
