After US SC setback, Trump may use older trade laws to revive tariff powers

With the Supreme Court striking down Trump's use of IEEPA for tariffs, the former president may rely on older trade statutes to revive tariff action. Each carries implications for India

The US Supreme Court’s ruling striking down the use of the International Emergency Economic Powers Act (IEEPA) for imposing country-specific “reciprocal” tariffs has forced President Donald Trump and his trade team to look for alternative legal routes to revive tariff action. While no statute gives the president the same sweeping power that IEEPA provided, Trump still has a broad arsenal of trade tools — some fast, some targeted, some politically explosive — that can keep trading partners on edge. Here is a breakdown of the tariff weapons still available to him and what each one means for India.

 

1. Section 232 — National security tariffs

 

Section 232 of the Trade Expansion Act of 1962 allows the US president to impose tariffs or quotas if imports are found to threaten national security. The Commerce Department conducts the investigation, but the president alone decides the remedy. This is the broadest surviving presidential tariff power after the 2026 Supreme Court ruling that removed emergency tariff authority under IEEPA. Section 232 has no fixed tariff ceiling, no expiry, and has previously been used to hit steel and aluminium imports globally.

 

India angle: 

India was hit in 2018 by Trump’s steel and aluminium tariffs under 232. A renewed 232 action — say, on critical minerals, electronics or medicines — would immediately affect India’s metal, auto-components and pharma export interests.

 

2. Section 301 — Unfair trade practices

 

Section 301 of the Trade Act of 1974 authorises the US Trade Representative (USTR) to investigate and retaliate against foreign policies that are “unreasonable, unjustifiable or discriminatory” and burden US commerce. If negotiations fail, the president can approve targeted tariffs or other restrictions. Section 301 was the legal engine behind Trump’s tariffs on roughly $370 billion of Chinese goods. It remains fully intact after the Supreme Court ruling but requires a formal investigation and published findings.

 

India angle: 

India faced a Section 301 investigation in 2018 over price controls on medical devices and market-access barriers. A new 301 probe — on digital policies, e-commerce rules, pharma pricing or tariffs on ICT products — would threaten India’s exports in IT hardware, pharmaceuticals and services.

 

3. Section 122 — Balance-of-payments tariffs

 

Section 122 of the Trade Act of 1974 allows the president to impose a temporary, across-the-board import surcharge of up to 15 per cent if the US faces a “large and serious” balance-of-payments deficit. Tariffs can last 150 days unless extended by Congress. Section 122 is rarely discussed because it has never been invoked — until the Supreme Court struck down Trump’s emergency tariff authority under IEEPA. Section 122 is now the default tool for fast, global tariff action by President Trump.

 

India angle: 

A 15 per cent across-the-board surcharge brings down the prevailing 28 per cent tariff for India but takes away the preferential advantage it would have enjoyed against its Asian peers at the negotiated 18 per cent tariff. This also makes the negotiated interim trade deal irrelevant for the time being.

 

4. Section 201 — Safeguard tariffs

 

Section 201 of the Trade Act of 1974 authorises safeguard tariffs or quotas when a surge in imports causes, or threatens to cause, serious injury to a domestic industry. The US International Trade Commission determines injury; the president chooses the remedy. Safeguards are temporary, usually lasting 3–4 years. Trump used Section 201 in 2018 to impose tariffs on solar cells and washing machines. Unlike Section 232 or 301, safeguards do not require allegations of unfair trade — just increased import volumes.

 

India angle: 

India is a major supplier in several surge-susceptible sectors — solar modules, steel products, tyres, chemicals, textiles and auto parts. A Section 201 case in any of these categories would immediately curtail India’s exports, even when there is no allegation of wrongdoing.

 

5.  Anti-dumping (AD) & Countervailing duties (CVD)

 

Anti-dumping (Section 731) and countervailing duty (Section 701) actions under the Tariff Act of 1930 allow the US government to impose punitive duties on imports sold below fair value or subsidised by foreign governments. Although not directly ordered by the president, these cases are run by the Commerce Department and the US International Trade Commission — both part of the executive branch — giving the administration indirect control. AD/CVD duties are legally durable, product-specific and politically popular, making them one of the most frequently used trade tools.

 

India angle: 

India is routinely targeted in AD/CVD cases — chemicals, steel products, pharma intermediates, tyres, IT hardware inputs. A protectionist US administration could amplify these cases to restrict Indian exporters without invoking presidential tariff statutes.

 

6.  Section 338 — Retaliatory tariffs

 

Section 338 under the Tariff Act of 1930 authorises the president to raise tariffs or impose restrictions against countries that apply “unreasonable or discriminatory” duties or trade barriers against US goods. While rarely used in modern trade policy, the authority remains legally valid. It functions as a presidentially directed retaliation tool without a formal USTR investigation, making it a fast but politically escalatory mechanism. Because the statute predates the WTO, its use today would be contentious but technically possible.

 

India angle: 

If US exporters — especially in agriculture, dairy, ICT or medical devices — claim discriminatory treatment in India, a protectionist White House could threaten or deploy Section 338, heightening bilateral tensions and pushing India into defensive tariff or regulatory responses.