Some commentators have suggested that the US Supreme Court’s recent decision invalidating certain presidential tariffs calls into question the legal and strategic foundation of the newly announced India–US trade deal. That assessment overstates the case. Although the Court’s ruling constrains one avenue of executive leverage, it does not dismantle the broader statutory architecture available to the president or otherwise prevent the administration’s use of tariffs in the articulation and execution of US trade policy. Nor should it materially unsettle the framework for trade deal negotiated over many months against the backdrop of a multifaceted strategic partnership. The trade deal should be understood as one component of an ongoing diplomatic and economic dialogue rather than as a transient instrument of tariff brinkmanship.
In Learning Resources, Inc. v. Trump, the Court held that the president lacked authority under the International Emergency Economic Powers Act of 1977 (IEEPA) to impose the challenged tariffs. The decision narrows the executive’s reliance on emergency economic powers for tariff measures. However, successive administrations—and President Trump in particular—have consistently maintained that alternative statutory authorities remain available.
Indeed, after the decision, the President invoked Section 122 of the Trade Act of 1974 to implement a global 15% tariff as a substitute for the measures previously imposed under IEEPA. While this measure can be immediate in effect (owing to the fact that Section 122 authority does not require a prior investigation), tariffs imposed under this authority are limited in that they cannot exceed 15% and, absent Congressional action, lapse after 150 days. While Republicans currently hold majorities in both chambers of Congress, support for broad-based tariffs is not uniform, particularly given concerns about consumer costs and inflationary pressures.
The executive branch also retains additional statutory tools. Section 232 of the Trade Expansion Act of 1962 authorises tariffs predicated upon a prior finding of a threat to national security. This provision has already been used to impose sector-specific tariffs on steel, aluminum, autos, and copper, and investigations remain pending in other sectors, including pharmaceuticals. Section 338 of the Tariff Act of 1930 permits tariffs of up to 50% against countries found, pursuant to a prior investigation, to discriminate against US commerce or to impose unreasonable charges.
{{/usCountry}}The executive branch also retains additional statutory tools. Section 232 of the Trade Expansion Act of 1962 authorises tariffs predicated upon a prior finding of a threat to national security. This provision has already been used to impose sector-specific tariffs on steel, aluminum, autos, and copper, and investigations remain pending in other sectors, including pharmaceuticals. Section 338 of the Tariff Act of 1930 permits tariffs of up to 50% against countries found, pursuant to a prior investigation, to discriminate against US commerce or to impose unreasonable charges.
{{/usCountry}}Finally, Section 301 of the Trade Act of 1974 authorises trade measures in response to unreasonable, discriminatory, or burdensome foreign practices, although that mechanism requires an investigation and formal determination, rendering it procedurally more time intensive. Initial comments from the administration following the announcement of the Supreme Court’s decision indicate an intent to recalibrate US trade policy using a combination of Section 122 and potentially enhanced Section 232 and 301 authorities.
For President Trump, tariffs function as instruments of negotiation. President Trump previously imposed a 25% tariff on India as part of a broader global tariff regime, followed by an additional 25% tariff in response to India’s purchases of Russian oil. From the administration’s perspective, such measures operate less as fixed policy commitments than as bargaining chips to extract concessions. The Supreme Court’s decision eliminates one such chip, but it does not foreclose the president’s capacity to deploy others. It would, therefore, be inaccurate to conclude that the ruling fundamentally undercuts the administration’s negotiating strategy or signals a change in the larger scheme of US trade policy.
India and the US have been engaged in sustained negotiations over a bilateral trade agreement for nearly a year. Both sides have made material concessions. The Supreme Court’s opinion may marginally recalibrate the negotiating dynamics, but it does not substantially alter the underlying distribution of leverage. Moreover, the trade agreement exists within a broader strategic framework encompassing defense cooperation, technology partnerships, and shared geopolitical interests in the Indo-Pacific. These structural considerations temper the likelihood of either party seeking to reopen or unwind terms painstakingly negotiated.
As the parties move toward finalising the bilateral trade framework, India may perceive modest incremental leverage. Nevertheless, the US is unlikely to accept a wholesale departure from the core contours of the broadly agreed terms. The Supreme Court’s decision is best understood as a doctrinal clarification of executive authority—not as a destabilising event for the larger trajectory of US-India economic relations.
This article is authored by Sital Kalantry, professor of law, Seattle University School of Law and founding director, Roundglass India Center and Robert Kossick, international trade lawyer, Washington.