Key Points

GTRI said "The move also signals a tougher Indian stance, especially in politically sensitive sectors like steel and aluminium that align with its "Make in India" industrial strategy".

It also noted that this move aligns with its "Make in India" industrial strategy and marks a significant step in its trade policy.

In a significant move on Monday targeting U.S. safeguard duties on steel, aluminium, and their related products, India has formally notified the WTO of its intention to suspend trade concessions granted to the United States.

The notice, issued on 12 May 2025 under document G/SG/N/12/IND/5, invokes India's rights under Article 12.5 of the WTO Agreement on Safeguards. This provision allows a country to retaliate when another member imposes safeguard measures without proper notification or consultations.

At the centre of the dispute are the U.S. safeguard tariffs on steel, aluminium, and derivative products. These duties were first introduced in 2018 on national security grounds and have been extended several times.

The latest extension came through U.S. Presidential Proclamations 10895 and 10896, issued on 10 February 2025 and effective from 12 March 2025.

India argues that these U.S. actions, although never formally notified as safeguard measures, act as such and breach WTO rules under the General Agreement on Tariffs and Trade (GATT) 1994 and the Safeguards Agreement.

Importantly, the U.S. failed to conduct the mandatory consultations under Article 12.3 of the Safeguards Agreement, prompting India to respond through retaliation

GTRI also added that Unless the U.S. initiates consultations or withdraws the measures, India's retaliatory tariffs may come into effect 30 days after the notification date--on 8 June 2025.

India has also kept the option open to revise the list of targeted products and adjust tariff rates, ensuring a proportional economic response.

This demonstrates India's intention to use the WTO platform firmly to protect its trade interests.

This is not the first time India has taken such a step. In June 2019, it imposed higher tariffs on 28 U.S. products--including almonds, apples, and chemicals--after the U.S. removed India from its Generalized System of Preferences (GSP) and continued with the steel and aluminium tariffs.

That retaliation, valued at about USD 240 million in trade, marked India's first use of WTO-sanctioned measures. These duties were later withdrawn in September 2023, following Prime Minister Narendra Modi's state visit to Washington, where both countries agreed to resolve six WTO disputes, including this one.

GTRI highlighted that now, much depends on how the U.S. responds.

It said "If the U.S. engages in consultations or withdraws the contested measures, a resolution may be reached. Otherwise, India's tariff response could take effect in early June, potentially affecting U.S. exporters and deepening trade frictions".

- ANI