India is weighing retaliatory action against the United States by suspending trade concessions and imposing higher tariffs on key American imports like almonds, walnuts, and metals, after Washington rejected New Delhi’s WTO notice over steep duties on steel and aluminium, Hindustan Times reported, citing people aware of the development.
On May 9, India formally notified the World Trade Organisation (WTO) that it could withdraw concessions extended to the US in response to a 25 percent tariff imposed by Washington on steel and aluminium imports, effective March 12. The retaliatory measures, as per India’s notice, could come into force after a 30-day period, starting June 8.
But in its May 22 reply, the US dismissed India’s case, arguing that the tariffs were not “safeguard measures” under WTO rules, and hence New Delhi had no legal grounds to suspend trade benefits. “Accordingly, there is no basis for India’s proposal to suspend concessions or other obligations under Article 8.2 of the Agreement on Safeguards with respect to these measures,” Washington said in its communication to the WTO, as reported by Hindustan Times.
The US also made it clear it would not enter talks under WTO’s safeguards framework, asserting that its tariffs fall under national security provisions of Section 232 of its Trade Expansion Act.
Now, India may respond by imposing retaliatory duties on select American imports unless the US offers preferential treatment for Indian metal products as part of an ongoing Bilateral Trade Agreement (BTA), the Hindustan Times report said. Talks for an early harvest trade deal are underway, with a US negotiating team expected in India this week.
The standoff worsened after the Trump administration on May 30 announced that the steel and aluminium tariffs would be raised further to 50 percent from June 4, citing the need to protect domestic industry.
This isn’t the first time the two countries have sparred over metal tariffs. A similar row broke out in 2018 during the Biden administration, when India responded with additional duties on 28 US products and a WTO complaint. That issue was settled through a Mutually Agreed Solution (MAS) in June 2023, where the US allowed limited market access for Indian metal products, and India rolled back some of the retaliatory tariffs.
With the WTO appellate body defunct, sources told Hindustan Times that such disputes often serve more as negotiating pressure than legal mechanisms. “Without an effective appellate body at the multilateral forum, disputes have no real significance,” one official said. Another called the issue “vexed,” hinting at deeper trade friction ahead.
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