Indian Exporters Receive Millions as US Supreme Court Strikes Down Trump Tariff Regime

Indian Exporters Receive Millions as US Supreme Court Strikes Down Trump Tariff Regime​

Several Indian exporters are beginning to receive substantial refunds of duties paid under the tariff regime imposed by the previous administration in the United States. Over $1 billion in reimbursements has been processed across various sectors, including textiles, seafood, and gems and jewellery, following the start of refund processing by US Customs and Border Protection (CBP).

This development is a direct result of a landmark ruling by the U.S. Supreme Court on February 20, 2026. The court determined that the global tariffs established under the International Emergency Economic Powers Act (IEEPA) were unlawful.

The Supreme Court observed that the IEEPA did not grant unilateral authority to the President to levy such taxes or regulate international trade. It clarified that constitutional power regarding taxation and international trade rests with Congress, subsequently directing that all duties collected under the invalidated tariff regime must be refunded.

The Legal Catalyst for Trade Recovery​

The tariffs were initially introduced by the Trump administration in April 2025 using emergency powers. Duties on Indian exports faced an additional charge of 26% during this period. This was later heightened in August 2025, with duties on several Indian-origin products increasing to as much as 50%, which significantly compressed margins and negatively affected export competitiveness across multiple industries.

Industry experts view the initiation of this refund process by US Customs as a pivotal milestone for global trade. Ranjeet Mahtani, Partner at Dhruva Advisors, noted that CBP is now processing refunds collected under the invalidated regime, and numerous importers have begun receiving these funds.

Refund Mechanics and Commercial Realities​

The official refund process has been initiated by U.S. Customs authorities. However, a crucial technical point must be understood: refunds are directed only to the Importer of Record (IOR) in the United States. The Indian exporter cannot directly claim the refund; rather, they rely on their US importer to successfully pass along the recovered amount.

Global trade shows that CBP had processed $71 billion in tariff refunds as of June 29. Saurabh Agarwal, Partner at EY, stated that approximately $35.46 billion, including interest, has been issued under the IEEPA duty refund programme so far.

While the process is underway, industry executives warn that recovery is not uniformly distributed among Indian exporters. A senior executive from a leading trade body confirmed that recovery extent depends entirely on existing commercial arrangements between the respective exporters and their American buyers.

Industry Caution Amid Refund Claims​

Indian businesses are advised to exercise significant caution when pursuing these refunds. Rahul Shekhar, Partner at Nangia Global, emphasized that refund claims are likely to be subject to heightened scrutiny by US Customs and Border Protection.

For a claim to be valid, it must be filed exclusively by the lawful Importer of Record or an authorized customs broker. This filing requires accurate customs declarations, genuine import entries, and complete supporting documentation. Although these refunds represent an unexpected boost to cash flows for some exporters after months of absorbing elevated duties, the speed and scale of recovery remain tied to commercial relationships with US importers.

Sectoral Performance Despite Tariff Pressure​

Data compiled by Moneycontrol highlights that Indian exports to the United States, which stood at nearly $72 billion during the tariff period, showed resilience in certain areas. Overall commodity trade rose 5.77 percent to $72.4 billion during April-January 2026 from $68.5 billion a year prior.

Electrical machinery and equipment surged significantly, almost doubling their trade volume to $20.9 billion from $11 billion. Machinery and mechanical appliances also rose by 9.03 percent, reaching $6 billion. Jewellery maintained strong status as the fourth-largest export commodity, albeit halving its previous value to $4.2 billion.

In contrast, the textiles and apparel sectors showed visible strain despite their massive scale in the trade basket. Other made-up textile articles fell 9.12 percent, while knitted apparel declined 7.9 percent. Knitted apparel trading volume stood at $2.04 billion, with non-knitted apparel slipping to $2.0 billion.