India US Trade Tariffs Under Emergency Powers: Implications for Exporters and Jobs

Uncertainty over the U.S. Supreme Court’s pending ruling on President Donald Trump’s global tariffs is creating fresh concern for India. Exporters and policy makers are assessing how any judgment on the president’s emergency trade powers could reshape India’s access to its largest export market and influence India’s overall trade balance with the US.

The court has not stated when it will revisit the tariff case, leaving a long window of doubt. During this period, the Trump administration’s trade measures continue to weigh on global commerce. For India, the central issue is whether the US president can keep using national security or emergency powers to impose wide-ranging duties on imports.

Even if the Supreme Court blocks the emergency tariffs, India would still face other duty pressures. Tariffs imposed under Section 232 of the US Trade Expansion Act of 1962 will remain unless changed through a separate process. These measures follow formal investigations that decide whether particular imports may threaten US national security, and therefore can continue independently of emergency rules.

Section 232 currently covers products such as steel, aluminium, automobiles, timber, copper, and selected machinery. In 2024, India shipped about 8.3 billion dollars of these goods to the US. That figure represented 10.4 per cent of India’s total exports to the American market, underlining how strongly India US trade tariffs already affect industrial sectors.

Automobiles made up the largest share of these security-linked exports, at about 3.9 billion dollars. Steel shipments reached roughly 2.5 billion dollars. Aluminium exports were close to 800 million dollars, while timber, copper, and industrial vehicles also remained exposed. Any continuation or increase in such duties could therefore directly hit India’s manufacturing earnings and investment plans.

Several of these industries rely heavily on US demand. Reports indicate that in 2024, around 39 per cent of India’s timber exports went to the US. The American market absorbed about 37 per cent of aluminium exports and roughly 34 per cent of steel exports. Concentration of sales in one destination makes firms more vulnerable when India US trade tariffs rise sharply.

India’s broader trade profile reflects a similar pattern. Exports to the US were about 80 billion dollars in 2024, making it India’s largest export destination. Pharmaceutical products and mobile phone components account for a large share in value terms. At the same time, the US dominates India’s overseas sales of shrimp, carpets, textiles, and several jewellery items.

This level of reliance creates a structural risk. Once US buyers react to higher duties by shifting orders to alternative suppliers, business relationships often change for the long term. Indian exporters can then find it difficult to win back previous volumes, even if India US trade tariffs soften later or trade rules become more favourable.

India US trade tariffs under emergency powers and IEEPA

The most immediate question before the US Supreme Court is whether President Donald Trump can continue using the International Emergency Economic Powers Act, or IEEPA, for broad trade restrictions. If the court upholds this power, Indian goods worth more than 50 billion dollars may keep facing import duties above 50 per cent under these emergency measures.

IEEPA allows the US president to react quickly during declared emergencies and impose trade limits across many categories. For India, this has serious implications for sectors that sell directly to American consumers. The law’s flexibility also increases uncertainty, since measures can be widened or extended while the emergency status continues.

The hardest hit segments are labour-intensive exports such as textiles, garments, carpets, and gems and jewellery. These sectors provide large-scale employment and are closely tied to specialised American retail supply chains. Goods are often produced to tight design and price specifications, making it difficult to divert shipments to other destinations when US demand weakens due to higher India US trade tariffs.

India US trade tariffs and early warning signs from recent data

Recent US import statistics already show some signs of strain on India’s position. In hair products used for wigs, India’s share of US imports dropped to about 51 per cent in September 2025. During the first seven months of that year, the share had been roughly 76 per cent, indicating a steep decline within a short period.

A similar pattern appears in worked synthetic or reconstructed diamonds. India’s share of US imports in this category fell to around 69 per cent in September 2025. Earlier in the year, the share had been about 93 per cent. Such shifts suggest American buyers are exploring alternative sources, possibly to manage risks arising from India US trade tariffs.

The changes are even sharper in certain high-value stone segments. India’s share of US diamond imports slipped to roughly 22 per cent in September from 51 per cent in preceding months. Granite exports saw India’s share fall from nearly 48 per cent to just 9 per cent. In selected stone products, the proportion dropped to around 31 per cent from earlier peaks near 88 per cent.

These trends indicate that some US importers are reducing dependence on Indian suppliers. Once replacement suppliers gain a foothold, price negotiations, logistics arrangements, and long-term contracts can lock in those changes. For Indian companies, that may mean lower export revenues even if India US trade tariffs stabilise.

India US trade tariffs and sector-wise exposure data

The scale of exposure across key product groups can be seen in the following data, which summarises 2024 export values and US market shares for selected sectors affected by India US trade tariffs.

Sector	Exports to US in 2024 (USD billion)	US share of India’s global exports (%)
Automobiles	3.9	Data not specified
Steel	2.5	34
Aluminium	0.8	37
Timber	Data not specified	39
IEEPA-covered goods	50+	Data not specified

For labour-intensive lines such as textiles, garments, carpets, gems, and jewellery, specific 2024 export values to the US were not stated. However, the narrative shows these items rely heavily on American demand. This reinforces the broader concern that India US trade tariffs can quickly spill over into employment and small business incomes.

India US trade tariffs and long-term risks for jobs

Short tariff shocks may push US buyers to reorganise supply chains, but the resulting changes can persist. Once orders shift to factories in other countries, Indian exporters might need to cut prices or invest heavily to regain contracts. Labour-intensive sectors, which support millions of workers and numerous small units, appear most at risk, exporters based in Kerala said.

Regardless of how the Supreme Court decides on the emergency tariff powers, reports suggest Indian exporters will continue to face higher costs and weaker price competitiveness in the US market. Persistent uncertainty around India US trade tariffs could also discourage new investment in export capacity, as firms hesitate to commit funds without clearer long-term rules.

The final ruling, whenever it arrives, will not erase the difficulties created by recent trade shifts. India’s strong dependence on the US for several key products means that even partial or sector-specific duties have wide effects. Policy makers and businesses therefore need to track the court process closely while exploring ways to diversify markets and products.

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