India is weighing the imposition of retaliatory tariffs on a range of high-value U.S. exports, including advanced medical equipment, in response to the U.S. decision to extend safeguard duties on Indian steel and aluminium products. Two individuals familiar with the matter revealed that unless a resolution is reached by early June, India may move ahead with these countermeasures.
India formally notified the World Trade Organization (WTO) on May 12 that it plans to impose retaliatory duties worth $1.91 billion on U.S. imports. However, it also signaled openness to dialogue by offering a 30-day consultation window, according to an official submission made by New Delhi to the global trade body.
Sources indicated that the list of targeted goods may include U.S. exports with high commercial value and strategic significance such as agricultural products, petrochemicals, and sophisticated medical devices. This move reflects a more assertive stance by India during trade negotiations, even as the U.S. has reached partial agreements with other countries like the UK and China to reduce though not eliminate similar tariffs.
Commerce Minister Piyush Goyal is set to lead a delegation to Washington beginning May 16 to push forward talks on a bilateral trade agreement. This effort comes during a temporary 90-day suspension announced by former President Donald Trump on April 9 on further tariff hikes for key trading partners, including India, which faces a potential 26% across-the-board duty if no deal is reached by July 8.
While India continues to be subject to a base 10% duty during the pause, it seeks to finalize a trade agreement within this window. Bilateral trade between the two countries reached approximately $129 billion in FY25, with India enjoying a $45.7 billion trade surplus.
India hasn’t officially published the list of U.S. products it intends to target, but past retaliatory actions included items such as almonds, apples, lentils, and chickpeas. This latest action is grounded in WTO rules under the Agreement on Safeguards, and directly responds to the U.S. decision made on February 10 to maintain elevated tariffs of 25% on steel and 10% on aluminium, originally introduced in 2018 and extended in 2020. Indian exports impacted by these measures amount to roughly $7.6 billion.
According to India’s WTO submission, the retaliatory tariffs are designed to match the value of duties collected under the U.S. measures, stating: “India’s proposed suspension of concessions would result in an equivalent amount of duty collected from products originating in the United States.”
“This is a deliberate, lawful step based on WTO rules,” said one of the officials cited, emphasizing India’s right to defend its trade interests without acting rashly.
Steel and aluminium are seen as key components of India’s Make in India initiative, vital for industrial development and employment generation. The potential tariff list will likely include items that are strategically important but will have limited adverse effects on Indian consumers.
If the U.S. fails to engage in consultations or roll back the contested duties, India’s retaliatory tariffs are expected to take effect by June 8, 2025. India has also left room to modify the targeted product list and duty rates, ensuring a proportionate economic response, according to Ajay Srivastava, former Indian Trade Service officer and founder of the Global Trade Research Initiative (GTRI).
India contends that the U.S. did not properly notify its safeguard measures to the WTO and plans to brief the Council for Trade in Goods and the Committee on Safeguards regarding its next course of action.
The timing of India’s WTO filing aligns with the U.S.’s 90-day freeze on further tariffs on Indian goods. If no compromise is reached, Indian exports could soon face the full brunt of a 26% additional tariff once the pause ends in July.
Trade experts note that the lack of mandatory consultations under Article 12.3 of the WTO’s Safeguards Agreement strengthens India’s case for retaliation.
This development occurs amid broader trade negotiations between India and the U.S. toward a comprehensive Free Trade Agreement. Though the retaliatory move could complicate discussions, India’s legally grounded and measured approach stands in contrast to Washington’s unilateral actions and underscores New Delhi’s commitment to multilateral trade norms.
“Washington’s next move will be critical,” said Srivastava. “If the U.S. agrees to talks or revokes its measures, a resolution is possible. Otherwise, the retaliatory duties will be enforced, potentially escalating tensions.”
Industry leaders are concerned about the implications of such tariffs. Sarvadnya Kulkarni, CEO of General Instruments Consortium, which manufactures precision instruments, noted that trade barriers have already disrupted global supply chains. “These tariffs disrupt procurement and reduce export competitiveness. India’s decision to raise this at the WTO shows that future trade relationships must be grounded in fairness and mutual benefit,” he said.
This isn’t India’s first trade retaliation against the U.S. In 2019, New Delhi imposed higher tariffs on 28 U.S. products, including nuts and fruits, following the revocation of India’s GSP trade benefits and continued duties on Indian metal exports. That dispute was resolved in 2023 after Prime Minister Narendra Modi’s visit to Washington. The current escalation suggests that India is now prepared to respond more assertively to recurring trade restrictions.
