SCOTUS Strikes Down Trump Tariffs; Indian Trade Delegation Aborts Visit

The Supreme Court of the United States (SCOTUS) has struck down US President Donald Trump's sweeping tariffs imposed under the International Emergency Economic Powers Act meant for use in national emergencies. On 20 Feb, in a 6–3 verdict, the SCOTUS upheld the cardinal principle of separation of powers, which constitutes a foundational pillar of the US Constitution. By reaffirming the US Congress’ jurisdiction to impose tariffs and the ideal of separation of power, the SCOTUS placed the Constitution above the power or authority of the President. The ruling means that 55% of India’s exports to the US will not face the 18% reciprocal tariffs. However, on 21 Feb, under Section 122 of the US Trade Act of 1974, Trump signed an executive order that enabled him to bypass the US Congress and impose first a 10% tax on imports from around the world, and then increased it to 15%. The US also has other tariffs in place, such as those under Section 232 of the US Trade Expansion Act of 1962. Under the Section 232 tariffs, the US has imposed a 50% tariff on India on imports of steel and aluminium. Meanwhile, after the announcement of the India-US interim trade deal, market prices for several commodities, including cotton and maize—which impact Panjab—and soyabean have fallen 3–9% below their respective Minimum Support Prices (MSP). Prices of wheat, whose harvest will start in Panjab at the end of March, is currently USD 2 below the MSP. The SCOTUS ruling and new Trump tariffs have led to confusion in trade talks where tariff figures have not been steady for months. Indian trade negotiators, headed to Washington for a 3-day talk starting 23 Feb to finalize the legal text of the US-India trade agreement, have aborted their trip as New Delhi pushed for rescheduling these discussions. Additionally, the US-India trade deal hinges on a key US requirement that India stop buying Russian oil. On 18 Feb, Russia's Foreign Ministry dismissed suggestions that India may scale back its purchase of Russian oil, saying, ‘Moscow sees no indication of a shift in New Delhi’s position,’ and describing the trade as mutually beneficial and stabilizing for global energy markets (earlier coverage).