'INDIA SHOULD RE-NEGOTIATE TRADE DEAL WITH THE U.S.'

India should either opt out or delay negotiations or seek fresh terms so that the trade deal looks equitable, say experts.

- SHIKHA SALARIA

With the US Supreme Court striking down the tariffs imposed by the Trump administration on different nations under the International Emergency Economic Powers Act (IEEPA)—a 1977 law intended for national emergencies—trade experts say that India should renegotiate the terms of the trade deal with President Donald Trump's power to impose tariffs having been blunted by the top court.

With the US Supreme Court ruling that Trump exceeded his authority by imposing tariffs under the IIEPA, stating that it did not authorize unilateral tariff action and that the administration cited no statute permitting such use, the ruling has technically invalidated country-specific “reciprocal tariffs” and fentanyl-linked duties imposed on imports from major trading partners.

A detailed report prepared by Global Trade Research Initiative (GTRI)—a research group focused on climate change, technology and trade—mentions that the decision has effectively rendered recent trade deals initiated or concluded by the US with the UK, Japan, the EU, Malaysia, Indonesia, Vietnam and India “one-sided and useless.”

"Partner countries may now find reasons to dump these deals. Trump could attempt to reimpose similar tariffs under Section 301 or Section 232, but those statutes require new investigations and public justification, delaying action and inviting further legal challenges," the report states, adding that “such measures cannot serve as a universal enforcement tool.”

Soon after the Supreme Court struck down the tariffs, Trump invoked Section 301 of the Trade Act of 1974 (unfair practices law) and Section 232 of the Trade Expansion Act of 1962 (national security law) to impose a global tariff of 10% (which he increased to 15% on Saturday) on all countries—a move which is on expected lines.