India has pushed back firmly against American demands for trade concessions ahead of a crucial round of negotiations in New Delhi. Commerce and Industry Minister Piyush Goyal told reporters on Monday that the July 24 deadline — when a temporary 10 percent US tariff imposed under Section 122 of the Trade Act of 1974 is set to expire — is a matter for Washington to worry about, not New Delhi.
The Context: A Fundamental Shift in US Trade Law
The negotiating environment between the two countries has undergone a significant transformation since talks began in early 2025. On February 20, 2026, the US Supreme Court invalidated the framework that had allowed the Trump administration to impose reciprocal tariffs — a legal cornerstone that Washington had used to justify broad tariff measures against trading partners worldwide.
With that authority gone, the administration has been forced to rebuild its tariff regime using alternative legal tools. The most consequential of these is Section 301 of the Trade Act of 1974, which allows the US government to investigate and penalize countries for trade practices deemed harmful to American industries. Unlike the now-invalidated reciprocal tariff framework, Section 301 tariffs can be targeted at specific sectors and are not subject to the same practical rate limitations.
Section 301: The New Leverage Tool
On March 11, 2026, the Office of the United States Trade Representative (USTR) initiated Section 301 investigations into 16 US trading partners: China, the European Union, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan and India. USTR alleges that these economies are “producing more goods than they can consume domestically,” creating structural excess capacity that “displaces existing US domestic production or prevents investment and expansion in US manufacturing.”
The investigations are designed to either justify long-term tariffs or extract bilateral trade concessions. On June 3, USTR released findings from its forced-labor investigation and proposed additional tariffs of 12.5 percent on imports from India and 53 other economies. This is not yet a final decision — public comments are being accepted until July 6 — but it serves as a negotiating lever ahead of Greer’s visit.
India’s Position: Why Backing Down May Be Costly
The Global Trade Research Initiative (GTRI), a Delhi-based think tank, argues that agreeing to adverse terms under a Bilateral Trade Agreement (BTA) would ultimately be more economically damaging to India than simply absorbing Section 301 tariffs.
“Even if a deal is signed, there is no guarantee that new tariffs will not follow,” said GTRI founder Ajay Srivastava. “The US has launched Section 301 investigations against the EU and Japan despite existing trade agreements. Countries could therefore make permanent and legally binding concessions while still facing future unilateral US trade actions.”
India’s core argument is straightforward: since Section 301 tariffs apply equally to all countries under investigation — not just India — the competitive position of Indian exporters relative to other suppliers remains largely unchanged. Meanwhile, India has leverage in sectors where American companies depend on Indian inputs, including pharmaceuticals, IT services and engineering goods.
What Changes After July 24
With the July 24 expiration of Section 122 tariffs approaching, most US imports will effectively return to the tariff framework that existed before April 2025, with the notable exception of sector-specific duties under Section 232 on steel, aluminum and downstream products.
This means the window for extracting major concessions is closing. Once Section 122 expires, the “Liberation Day” tariff regime — as the April 2025 measures were colloquially known — effectively ends. US negotiators, no longer able to threaten broad reciprocal tariffs, have Section 301 as their primary remaining tool.
The upcoming Greer visit on July 1-2 represents a final opportunity to shape the outcome before the legal landscape shifts. Whether India can secure durable commercial gains without making concessions that hollow out its domestic industries will define the long-term trajectory of one of the world’s most consequential trade relationships.
Anh: A trade negotiation meeting. (Nguon: Unsplash)