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Tariffs

India to Impose Retaliatory Duties on US Steel and Auto Tariffs

Strategic Insights

— 2 min read

India's government officials have signaled that the country will impose retaliatory duties on US steel and auto tariffs under World Trade Organisation (WTO) norms, as the chances of a US concession on these items seem slim. This move follows the US decision to levy a 25 per cent ad valorem tariff on imports of passenger vehicles, light trucks, and certain automobile parts from India, effective May 3, 2025. Indian exporters have already suffered losses worth over $5 billion due to the 25 per cent US tariffs on steel, which were later revised to 50 per cent in June. The proposed suspension of concessions or other obligations by India would take the form of an increase in tariffs on selected products originating in the United States.

Key Takeaways:

  • India plans to impose retaliatory duties on US steel and auto tariffs under WTO norms due to the lack of concessions from the US.
  • The US decision to levy a 25 per cent ad valorem tariff on imports of passenger vehicles, light trucks, and certain automobile parts from India, effective May 3, 2025, has sparked this move.
  • Indian exporters have already suffered losses worth over $5 billion due to the 25 per cent US tariffs on steel, which were later revised to 50 per cent in June.
  • The proposed suspension of concessions or other obligations by India would affect $2,895 million worth of imports annually into the United States of the relevant products originating in India.
  • India has maintained that the measures taken by the United States are not consistent with the General Agreement on Tariffs and Trade (GATT) 1994 and the Agreement on Safeguards.
  • India reserves the right to suspend concessions or other obligations, as consultations sought by India on these tariffs have not taken place.
  • The duty collection would amount to $723.75 million. "Accordingly, India's proposed suspension of concessions would result in an equivalent amount of duty collected from products originating in the United States."

Statistics:

  • The proposed suspension of concessions or other obligations by India would affect $2,895 million worth of imports annually into the United States of the relevant products originating in India.
  • The duty collection would amount to $723.75 million.
  • Indian exporters have already suffered losses worth over $5 billion due to the 25 per cent US tariffs on steel, which were later revised to 50 per cent in June.

Sources:

  • [Source 1] - IE Online Media Services Pvt. Ltd., distributed by Contify.com
  • [Source 2] - WTO notification, circulated at the request of India
  • [Source 3] - WTO's Council for Trade in Goods

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