On February 20 the US Supreme Court ruled 6–3 that the emergency law used to impose most of Trump’s tariffs did not allow them. A temporary global tariff replaced them within hours, and India’s brand-new 18% deal suddenly looked expensive.
Eighteen days after India agreed to stop new purchases of Russian oil to get its US tariff cut to 18%, the US Supreme Court ruled that the law behind most of those tariffs never allowed them. On February 20, the court decided 6–3 that the International Emergency Economic Powers Act, the 1977 law the administration had used, does not give the President power to impose tariffs. The ruling covered the reciprocal tariffs on almost every trading partner, including India.
What replaced them
The administration moved within hours. It imposed a temporary global tariff under Section 122 of the Trade Act of 1974, an old provision that allows import charges of up to 15% for up to 150 days to deal with balance-of-payments problems. Tariffs imposed under other laws, including those on steel, aluminium and auto parts, were unaffected. The US trade office also announced investigations under Section 301, which could lead to new country-specific tariffs later.
India negotiated hard for a lower rate. Then a court lowered the rate for everyone.
Why India’s position is awkward
For Indian exporters, the immediate effect is mostly positive. A uniform temporary rate is lower than the 18% India had just secured, and far lower than August’s 50%. But the diplomatic arithmetic is uncomfortable. India gave up cheap Russian oil, a real cost running into billions of dollars a year, to win a rate that a court then removed for every country. Exporters in Vietnam and Bangladesh now face the same temporary rate without having given anything up.
The bigger lesson is about uncertainty. In just over six months, Indian exporters have faced rates of 25%, 50%, 18% and now a temporary uniform rate that expires in July. Factories can adjust to almost any tariff. What they cannot plan around is a rate that changes every few weeks.
Sources: US Supreme Court decision, February 20, 2026; White House proclamation under Section 122.
- The Supreme Court ruled 6–3 that the IEEPA emergency law does not authorise tariffs.
- The reciprocal tariffs, including India’s, were invalidated. Steel, aluminium and auto tariffs under other laws stayed.
- The administration imposed a temporary global tariff under Section 122, limited to 150 days and 15%.
- India had paid a real price in oil for an 18% rate that a court then removed.
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