In response to the tariffs imposed by the United States on automobiles citing national security concerns, India on Friday submitted a proposal to the World Trade Organization (WTO) seeking to impose retaliatory tariffs on US goods.
This move comes amid ongoing trade deal negotiations with the Donald Trump administration. India informed the WTO’s Council for Trade in Goods that, in response to the US tariffs on automobiles based on national security grounds, it plans to suspend certain concessions or obligations on imports from the US.
Why Did Trump Impose Safeguard Tariffs?
According to the WTO, under India’s proposal to suspend concessions or other obligations, tariffs on select US-made products will increase. It is worth noting that on March 26 this year, the US imposed a 25% tariff as a safeguard measure on automobile and auto parts imports from India, which came into effect on May 3, 2025.
American President Trump justified the move by saying that the US had been at a disadvantage in global trade for decades, and this step would boost the domestic manufacturing sector by reducing competition from foreign companies in the US market.
India’s Response
Trump’s tariff covered items such as light trucks, cars, lithium-ion batteries, tires, spark plug wires, shock absorbers, engines, and transmissions. However, the US did not notify the WTO of these regulations.
India has argued that the US tariffs are not in compliance with the General Agreement on Tariffs and Trade (GATT) 1994 and the Agreement on Safeguards. Moreover, the US had already held consultations with India under Article 12.3 of the Agreement on Safeguards (AoS). Therefore, India has reserved its right under Article 8 of the AoS to suspend concessions in return.