US tariffs on India: 26% to 15% timeline explained 2026

The latest reset: a 10% tariff, then 15%

The United States’ tariff framework affecting India has shifted again after a US Supreme Court ruling struck down reciprocal tariffs imposed under the International Emergency Economic Powers Act (IEEPA). Following the ruling on February 20, 2026, President Donald Trump imposed a 10% global tariff under Section 122 of the Trade Act of 1974. The next day, February 21, he said the rate would be raised to 15%, within the 150-day statutory limit under Section 122.

This matters for Indian exporters and listed companies because the headline tariff rate does not fully describe the final duty they may face at the border. Sector-specific national-security tariffs on steel, aluminium and certain auto components remain legally separate from the reciprocal tariffs and continue to apply. Trade remedies such as anti-dumping and countervailing duties can also push effective costs higher for specific products.

How the dispute built up in 2025

The broader US tariff expansion began in February 2025, when duties of up to 25% were imposed on major trading partners including Canada, Mexico and China. On April 2, 2025, Washington introduced a universal 10% baseline tariff alongside higher reciprocal tariffs for multiple countries, including India.

In the India case, the US announced a 26% total tariff on April 2, 2025, structured as a 10% baseline duty plus a 16% reciprocal component. India and other countries pushed back, and on April 9 the 16% reciprocal component was suspended for 90 days, keeping India’s effective additional burden at the 10% baseline while negotiations continued.

Engagement continued through mid-2025, including Commerce Minister Piyush Goyal’s March 4–6 visit to Washington DC for discussions with US Trade Representative Jamieson Greer and other officials. An Indian delegation returned to Washington on June 26, 2025, ahead of a key deadline, as both sides sought to avoid further escalation.

From 25% to 50%: the Russia-linked penalty

By late July 2025, the tariff path turned sharply more punitive. On July 31, 2025, the US announced a revised 25% tariff on Indian goods, effective August 7. On August 6, 2025, an additional 25% tariff was announced, linked to India’s Russian oil purchases, taking the total tariff burden on Indian exports to 50% effective August 27, 2025.

This 50% level was described as the highest during the dispute, and it materially changed export economics for several categories. The text also notes that, in some cases, effective tariff burdens could exceed 50% due to the addition of trade remedies on top of the headline rates.

Negotiations and the interim deal signal

Negotiations intensified in October 2025, with further rounds of talks in Washington and six formal negotiation rounds completed by that stage. On January 31, 2026, Piyush Goyal said India was working to finalise an agreement, indicating potential tariff relief.

On February 2, 2026, India and the US agreed on an interim trade deal under which US tariffs on Indian goods were reduced to 18% from 25%. India, in turn, reduced tariffs on select US goods to zero under the arrangement. The eventual tariff burden on Indian exports, however, was described as contingent on how and when the interim agreement is formally implemented, and on the US legal route used to sustain or change duties.

Six phases of escalation, then the court-driven reset

Ajay Srivastava, Founder of the Global Trade Research Initiative (GTRI), described six distinct phases in the past year:

• Phase 1: MFN-only (before April 2, 2025)
• Phase 2: MFN + 10% (April 2–August 6, 2025)
• Phase 3: MFN + 25% (August 7–August 26, 2025)
• Phase 4: MFN + 50% (August 27, 2025–February 6, 2026)
• Phase 5: MFN + 25% (February 7–February 24, 2026)
• Phase 6: MFN + 10% (February 24–July 26, 2026), using Section 122 for 150 days

In numerical terms, the additional tariff moved from 0% to 10% to 25% to 50% to 25% to 10%. The later update adds that Trump announced the 10% would be increased to 15% after it was first set at 10%.

What remains outside the reset: exemptions and sector tariffs

The tariff reset does not mean all Indian exports face the same treatment. The text states that products accounting for roughly 40% of India’s export value, including smartphones, petroleum products and medicines, were already exempt from US tariffs and were never subject to the 25% reciprocal surcharge.

It also states that about 55% of India’s exports to the US are now freed from the 25% additional duty and have reverted to standard MFN rates. Separately, certain sectors continue to face national-security tariffs that remain in force: 50% on steel and aluminium, 50% on copper, and 25% on certain auto components.

Effective tariff: why the headline rate can mislead

Even with a temporary across-the-board tariff framed at 10% and then 15%, the overall impact depends on product mix and overlapping duties. GTRI estimates the average effective tariff on Indian exports at roughly 13.4%, and also cites a weighted average impact of around 13.5% across sectors.

The text also gives an example of how trade remedies stack with tariff actions: shrimp exports may face a zero MFN rate but attract a 2.49% anti-dumping duty and a 5.77% countervailing duty. In the cited structure, this results in a 33.26% levy (25% plus 2.49% plus 5.77%) for that product in the relevant period, highlighting why company-level exposure requires item-level tracking.

Key timeline and current moving parts

Market impact: what investors track in India

For Indian equities, the most direct sensitivity is in export-heavy sectors and companies with high US revenue exposure, especially where pricing power is limited. The text highlights that sector-specific tariffs on steel, aluminium, copper and certain auto components remain in place, which is relevant for metal producers and auto-component exporters.

The exemption list also matters for market perception. Smartphones, petroleum products and medicines are cited as outside the reciprocal surcharge net, and these categories together account for roughly 40% of export value. Meanwhile, the note that about 55% of exports have reverted to MFN rates implies that the sharpest tariff shock is not uniform across the export basket.

Why the next steps depend on US law and implementation

The final tariff burden is described as contingent on whether the US Congress extends the 150-day tariff window under Section 122, how and when the interim India-US trade agreement is formally implemented, and whether the administration uses additional legal authorities to adjust duties.

That combination leaves businesses watching both policy and process. Exporters are likely to track not only the headline 10% to 15% shift, but also the legal durability of the Section 122 action, and whether negotiations move from an interim arrangement to a formal implementation framework.

Conclusion

US tariffs affecting India have moved from a 26% announcement to a 50% peak, then down to 18% in an interim deal framework, and now into a Section 122-based global tariff set at 10% and later raised to 15%. With sector-specific national-security tariffs still in force and product exemptions unchanged, the next inflection point is tied to the 150-day statutory window and the implementation path for the interim agreement.